Category: Uncategorized

The failure of easy debt-money

Remember, the size of the contraction tends to be determined by the size of the expansion:

The amount of debt globally has soared more than 40 percent to $100 trillion since the first signs of the financial crisis as governments borrowed to pull their economies out of recession and companies took advantage of record low interest rates, according to the Bank for International Settlements.

The $30 trillion increase from $70 trillion between mid-2007 and mid-2013 compares with a $3.86 trillion decline in the value of equities to $53.8 trillion in the same period, according to data compiled by Bloomberg. The jump in debt as measured by the Basel, Switzerland-based BIS in its quarterly review is almost twice the U.S.’s gross domestic product.

Borrowing has soared as central banks suppress benchmark interest rates to spur growth after the U.S. subprime mortgage market collapsed and Lehman Brothers Holdings Inc.’s bankruptcy sent the world into its worst financial crisis since the Great Depression. Yields on all types of bonds, from governments to corporates and mortgages, average about 2 percent, down from more than 4.8 percent in 2007, according to the Bank of America Merrill Lynch Global Broad Market Index.

This is really remarkable considering that the USA’s total credit market debt has only increased from $52.9 trillion to $59.0 trillion. The reason that so few people recognize what is happening is that the scale is an ORDER OF MAGNITUDE bigger than the Great Depression.

Irony

Perhaps if he had said something to this effect back in 2008, the problem might have been addressed, if not necessarily averted:

George Soros, the billionaire investor, believes the banking sector is a “parasite” holding back the economic recovery and an “incestuous” relationship with regulators means little has been done to resolve the issues behind the 2008 crisis.

“The banking sector is acting as a parasite on the real economy,” Mr Soros said in his new book “The Tragedy of the European Union”.

“The profitability of the finance industry has been excessive. For a while 35pc of all corporate profits in the United Kingdom and the United States came from the financial sector. That’s absurd.”

Mr Soros outlined how the problems that caused the Eurozone economic crisis remain largely unresolved.

“Very little has been done to correct the excess leverage in the European banking system. The equity in the banks relative to their balance sheets is wafer thin, and that makes them very vulnerable. The issue of “too big to fail” has not been solved at all.”

I don’t recall Mr. Soros opposing the 2008 banking bailout. It’s not as if the intrinsically parasitical nature of the finance industry is news to anyone of Mr. Soros’s stature and occupation. No economy can expect to grow as long as a significant percentage of the profits produced are skimmed by the monetary middlemen, for the obvious reason that the middlemen produce nothing.

The international hypocrite

No one can reasonably take the US position on Crimean self-determination seriously anymore. Even the New York Times appears to be uncomfortable with the Obama administration’s anti-democratic actions:

They wanted to break away from a country they considered hostile. The central government cried foul, calling it a violation of international law. But with the help of a powerful foreign military, they succeeded in severing ties.

The Kosovars’ secession from Serbia in 1999 drove a deep wedge between the United States and Russia that soured relations for years. Washington supported Kosovo’s bid for independence, culminating in 2008, while Moscow saw it as an infringement of Serbia’s sovereignty.

Now 15 years later, the former Cold War rivals again find themselves at odds, but this time they have effectively switched sides: Russia loudly proclaims Crimea’s right to break off from Ukraine while the United States calls it illegitimate. The showdown in Ukraine has revived a centuries-old debate over the right of self-determination versus the territorial integrity of nation-states.

The clash in Crimea is hardly an exact parallel of the Kosovo episode, especially with Russian troops occupying the peninsula as it calls a March 16 referendum to dissolve ties with Ukraine and rejoin Russia. Though the United States intervened militarily in Kosovo, it did not do so to take the territory for itself. But the current case underscores once again that for all of the articulation of grand principles, the acceptability of regions breaking away often depends on the circumstances.

Consider the different American views of recent bids for independence.
Chechnya? No.
East Timor? Yes.
Abkhazia? No.
South Sudan? Yes.
Palestine? It’s complicated.

It is an acutely delicate subject in the West, where Britain wants to keep Scotland and Spain wants to keep Catalonia.

And the USA murdered hundreds of thousands in order to forcibly “keep the Union together” and deny the sovereign Southern States their right to self-determination. This has not escaped the attention of the world’s second-rate powers, some of whom have indicated support for the Russian position:

Indian officials have told Telegraph India that, in the
newspaper’s words, Delhi is “convinced that the West’s tacit support for
a series of attempted coups against democratically elected governments —
in Egypt, Thailand and now Ukraine — has only weakened democratic roots
in these countries.”

This is the cost of sacrificing principles for pragmatism. You don’t get to claim the moral high ground anymore and no one is going to view you as the good guy. Russia is acting perfectly within its rights: it has permission to station as many as 25,000 troops in the Crimea. Not only that, but its actions are far more in accord with legitimate democratic rule than those of the anti-democratic USA and EU, who are complicit in overthrowing Ukraine’s democratically elected government as well as installing an unelected prime minister in Italy.

This comment from Zerohedge may explain the real reason for the drama in the Ukraine:

According to the staff of the “Borispol” airport in Ukraine, four large armed trucks and two cargo minivan Volkswagen without license plates arrived to the airport and parked near a transport aircraft at the end of one of runways. About fifteen people in black uniform, wearing masks and bullet-proof vests came out of these vans. Some of them were armed with assault rifles. These people have moved more than 40 heavy boxes from the trucks into the aircraft…. Later, one of the senior officials of the former Ministry of Revenue and Taxes reported that, according to his information, last night, at the order of one of the “new Ukrainian leaders” the entire gold reserve of Ukraine has been sent to in the United States. 

If true, that seizure should permit the Federal Reserve to stave off the collapse of the markets for a little while longer. A lot of the recent international activity looks disturbingly like pre-positioning for economic collapse.

Mailvox: independent vs self-publishing

An anonymous author writes with an inquiry about the two primary publishing alternatives:

I’ve been following your posts about Castalia House with interest. In the comments to ‘A model comparison’ you mention the advantages of an author publishing through CH are “Awareness, editing, covers, endorsement, and not having to deal with all the business BS. Self-publishing will not suit at least 75 percent of authors.” I’m looking to publish three books later this year that would be nearly impossible to sell to traditional publishers, so even if I was okay with tradpub royalty arrangements, independent and self-publishing are my only real options. Given that, I’d be interested in reading a more detailed post on what one gains and loses with the different models, if you have the time and inclination to write it.

This is the right time to ask that question. But before we look at the advantages of publishing with us, let’s look at the three chief advantages of self-publishing, which are genuine and material.

  1. Keep all the royalty revenues. Amazon takes 30 percent plus a very small delivery fee that usually amounts to about 1.2 percent, so the self-publisher can realistically expect to make 68.5 percent of list on ebooks. That is twice what our novelists make on our standard agreement, (we offer 50 percent on all hardcovers and ebooks, which works out to 34.5 percent of list), and nearly three times what most writers will make from the independent publishers that offer 35 percent. For the sake of reference, it’s also 8.5625x what the traditional publishers pay on hardcovers. (Hardcovers are different; I will break down those numbers in a future post.)
  2. Complete control. The author can decide on his own cover, make his own editorial decisions, price the book as he sees fit, and publish the book according to his own schedule.
  3. Complete information. The author has direct access to the sales data.

Those three things are not nothing. I have nothing but respect for those who go the self-publishing route. That being said, I am certain that it is not the best route for the majority of writers who are good enough to interest independent publishers for the following eight reasons laid out at Castalia House.

There is no question that self-publishing is the optimal financial deal for those equipped to handle it. However, most writers are not equipped to properly handle it either materially or emotionally, observably tend to compromise on the production values in order to reduce their production costs, and will end up selling fewer copies than the breakeven point with independent publishing.

I fully support self-publishing. I think it is revolutionary and an unmitigated Good Thing. But I am aware that most authors, like me, would prefer to focus on writing rather than being distracted by running a publishing business. I chose to publish with Marcher Lord rather than self-publish and I would still happily be doing so if Marcher Lord had not been purchased. So, as a consequence, Castalia House has been set up to be the most author-friendly independent publisher that this author believes it is possible for a publishing house to be.

But there is no need to take my word for it. I recommend talking to our authors and asking them about their experience working with us. I believe you will find they do not regret their decisions to do so. One agent asked me how an author could possibly know his sales numbers when we were not contractually obligated to disclose them for a period of several months. He was a little surprised when I pointed out that the contract was our minimal obligation and it happens to suit us to periodically exceed that obligation so that our authors can know exactly how well their books are doing, and to know when they exceed certain objectives.

China’s export crash

We already know that China is due for a serious debt-crash on the basis of its successful post-2008 bubble inflation. The Zerohedge chart demonstrates the difference between US asset-disinflation and Chinese asset-inflation, all of which is debt-based.  And M2 is up by 1,000 percent since 1999. But that’s the warning; the first sign that the end was in sight was when a small bank threatened to go into default a few months ago. It was promptly bailed out and the entire matter was swept under the rug, ignored by pretty much everyone who doesn’t read Zerohedge.

However, it’s a little hard to ignore a miss of this magnitude:

Plenty of excuses out there for this evening’s colossal miss in Chinese exports (-18.1% YoY vs an expectation of a 7.5% rise) mainly based on timing issues over the Lunar New Year (but didn’t the 45 economists who forecast this data know the dates before they forecast?) This is a 6-sigma miss and plunges China’s trade balance to its biggest miss on record and 2nd largest deficit on record.

Economic statistics are largely fictitious, of course, but the size of this miss is indicative of a problem that is getting too big for even the most outrageous fictions to conceal.

#SoButthurt

The humor, it simply refuses to stop happening:

The outcry over LonCon’s decision
to ask controversial British talk show host Jonathan Ross to host the
Hugos just won’t end. After a week filled with accusations of bullying
and harassment on all sides, a new wave of backlash swept the sci-fi community Thursday evening after one noted author used the wrong Twitter hashtag…. The convention apologized to everyone and apparently satisfied no one: First to Ross and his family for the harassment they received, then to those who were upset that Ross was chosen, and to those who were upset he would not be hosting. Additionally, the convention seemed to abjure full responsibility for the decision, claiming that “we did not consult widely or promptly enough within our own Committee or with external parties.”

This seems to contradict a now-private statement by one committee member that she argued with the chairs for days over their decision, and resigned in protest after gathering that the decision was not up for debate.

Many members of the sci-fi community felt the apology rang false and accused LonCon of catering to Ross (and to celebrity author Neil Gaiman, who Ross claimed asked him to host). Others blamed easily-offended Americans for the brouhaha, despite the time zone difference. And still others blamed social media for causing the whole situation to spiral out of control.

Social media has continued to drive the debate in the days since Ross’s withdrawal, and it has predictably catalyzed the latest turn of events. Perhaps as a result of what writer Chuck Wendig called “social PTSD,” last night, bestselling fantasy author Patrick Rothfuss, known for his Kingkiller Chronicle series, asked the community to simmer down:

    Um, guys? Can we all stop being dialed-to-11 offended about everything? Then being offended that people are offended we’re offended? Please?
    — Pat Rothfuss (@PatrickRothfuss) March 6, 2014

    @wilw I know these conversations are important. But it feels like I’m awash in an endless sea of butthurt all the time these days. #SoWeary
    — Pat Rothfuss (@PatrickRothfuss) March 6, 2014

Twitter user Rose Fox took the hashtag and issued a sarcastic response:

    You know what I’m #SoWeary of? Talking about “being offended” like it’s a bad choice. As though there’s something wrong with giving a shit.
    — Dandy McFopperson (@rosefox) March 7, 2014

Rothfuss may have just been trying to soothe the community. Instead, he drew a number of raised eyebrows as the sci-fi community weighed in.

    .@PatrickRothfuss That’s a good attitude to take toward one’s own behavior, but a problematic one to apply to less powerful folks. + @wilw
    — P Nielsen Hayden (@pnh) March 6, 2014

    .@PatrickRothfuss + You or I can get a lot of instant attention to a problem if we choose. Most people have to raise their voices. @wilw
    — P Nielsen Hayden (@pnh) March 6, 2014

    @pnh @PatrickRothfuss @wilw And even when we do, we’re called shrill, or hysterical. See the hash tag #iaskedpolitely
    — Beth Bernobich (@beth_bernobich) March 7, 2014

The ironic thing is that the freak show these freakshows put on is more entertaining than anything they write. FAR more entertaining. Someone used the wrong Twitter hashtag? LET THE PURGING BEGIN!!!!

It’s more than a little amusing to see the Tor editor, Patrick Nielsen Hayden, leaping in and wagging his finger as he desperately tries to stay on the good side of the rabid rabbits. It’s only a matter of time before they turn on him and McRapey, their best efforts to disguise the fact that they are Powerful White Men notwithstanding. McRapey can lie low and wear dresses, and Nielsen Hayden can cleverly feign marriage to an amphibious abhuman to try to hide the fact that they possesses alabaster male sex organs, but eventually someone is going to notice.

I would add #freakshow to this post, but since I’ve already added #SFWA, that would be redundant.

History rises

Jerry Pournelle observes that those who know nothing of history cannot learn anything from it:

I am now convinced that no one in power in this nation knows any history whatsoever. Not even the history of the Seventy Years War with Bolshevism or what we call The Cold War – which now may become Cold War One if Barrack Hussein Obama de Santa Anna has his way. The State Department has, I am told, 3000 officers with PH.D.’s. One wonders in what subjects. Certainly not in history….

After the collapse of the Soviet System there was a period in which there was indeed a reset in the relationship between Russia and the United States, as Herman Kahn predicted there would be. Then came the Balkan crisis in which the ancient blood feuds dating back to the 13th Century were revived. That had lasted through the conquests of the Balkans and Hungary in the reign of Suleiman the Magnificent, and continued as the Turkish controls began to recede.  Then came the first Balkan Wars with their “Bulgarian Atrocities”, and the gradual liberation of Balkan nations, the brief existence of the Christian Kingdom of Montenegro, consolidation with Serbia, World War I and the dissolution of the Austrian Empire, formation of the Kingdom of Yugoslavia, German occupation of the Balkans, communist Tito vs. Christian monarchist Draza Mihailovich, Tito’s victory and consolidation of Yugoslavia, Tito’s defection from the Soviet bloc and his attempt to play the USSR against the West to his advantage, and the breakup of Yugoslavia at his death. And during all those times the ancient blood feuds and hatreds continued. All contending sides had factions who advocated and used ethnic cleansing as a tactic.

The Russians, as Russians always do – see the origins of The Great War — took the side of the Christian Slavs. This resulted in several standoffs between US and Russian forces, one or which came within minutes of a shooting engagement. The US began bombing Serbs, and US air strikes crippled the economy of the Lower Danube for at least a year. From the Russian view, the US chose sides: against Slavs. The truth of this is not so important as the deep seated belief among many Russians that it is true.The kind of army you have will dictate the kind of foreign policy you have.  The 300 Spartans bought time == just enough for the Spartans and Athenians to win at Plataea. A strategy of Technology is needed; so are Seals and Marines. The United States has been able to depend on the seas as moats behind which we can mobilize, with Big Bill Knudsen’s conversion of Detroit to making cannon, tanks, airplanes, machine guns, rifles, artillery in enormous quantities to arm the conscripted soldiers being trained by the old Regulars, and the Marines held on by their teeth in the South Pacific. But the pace of war has changed, and we no longer have Detroit. We seem to have forgotten some of the lessons of Task Force Smith and Korea. As the pace speeds, the force you must fight with is the force you have at hand and can transport.

Restructuring of the armed forces of the United States is needed, but it is far more complicated than simply fixing numbers and budgets. It also involves the schools and what is taught in them. And entrusting the safety of a Republic to paid soldiers has downsides.  Robert Heinlein and I debated for much of his life over conscription. His view was that any nation that needed conscripts had no right to exist. Mine was closer to Machiavelli’s. Conscription has the many benefits for a Republic, and its effects on liberty are not purely negative.  A nation needs paid professional Legions, but their existence allows them to be sent to wars we might be better off avoiding. Clinton would not have sent conscripts to the Balkans.

On the plus side, it could be worse. A President McCain wouldn’t even think twice before launching a land war in Asia. Sure, Obama’s outsourcing of American foreign policy to Goldman Sachs and their pet neocons of the New American Century is going to lead to a disaster, but at least the bankers understand that too much war is bad for business.

As long as the politicians are held in contempt, and as long as the people don’t get behind them, total war is out of the question. The world leaders to worry about are those who can achieve mental buy-in from the public, because they are the leaders with the potential to spark the global conflagration.

Sounds just like SFWA

What is happening in Birmingham, England is pretty much what happened over the last 20 years at the SF/F publishers, and what is happening right now in SFWA:

Islamic fundamentalists are allegedly plotting to convert Birmingham schools so that children are taught according to strict Islamic codes by ousting teachers through a dirty tricks campaign and replacing them with radicals. The city council and the Birmingham Mail have received documents which purport to show that jihadists – or those fighting against non-Muslims – are targeting schools and orchestrating false allegations against staff, including non-Muslims, in an operation dubbed Trojan Horse.

The SFWA knows all about false allegations; it has an entire report full of them. Notice that even on Wikipedia, the SFWA action is falsely reported.

“In June, Beale used the SFWA Twitter feed to post several controversial links to his blog, in which he called an African-American author a “half-savage” and an editor a “fat frog.”. After complaints from members, in August, the SFWA Board announced that they were expelling Beale as a member due to violations of their by-laws. Beale posted a letter from the SFWA president to his blog.”

Let’s count the errors:

  1. I used the @swfaauthors feed, not the official SFWA one. They are two different Twitter accounts.
  2. I did not post several controversial links to my blog. I posted one link and it contained nothing controversial. It was the blog post that was controversial, not the Tweet.
  3. The SFWA Board did not announce that they were expelling me. They did not name the member expelled in their announcement. As Locus Online correctly noted, I was the one who announced my expulsion.
  4. The SFWA Board did not announce I was expelled due to violations of their by-laws. The SFWA Board did not give any reason for the expulsion of the unnamed member expelled.
  5. To be complete, I referred to N.K. Jemisin as “an educated, but ignorant half-savage, with little more understanding of
    what it took to build a new literature by ‘a bunch of beardy old
    middle-class middle-American guys’ than an illiterate Igbotu tribesman
    has of how to build a jet engine” and I stand by the assertion. I also pointed out that she is a liar.
  6. In addition to her resemblance to an overweight amphibian, I also observed that Teresa Nielsen Hayden is “grotesquely malformed” and does not appear to belong to the same species or phylum as my wife.

The SFWA are irreligious fundamentalists, they just happen to be softer, squishier, and more cowardly than the Islamic variety. And this is why diversity is always and everywhere doomed. Let one rabbit in, and its priority is always to get another rabbit in there with it. Once accomplished, the breeding begins. And when they feel they have sufficient numbers, they begin forcing all the not-rabbits out.

Why Putin invaded

It’s not too hard to understand once you realize that the anti-democratic coup in Ukraine had nothing to do with the Ukrainian people.

Arseniy Yatseniuk; born May 22, 1974 is a Ukrainian politician,
economist and lawyer who is the Prime Minister of Ukraine following the
parliament’s 2014 removal of Viktor Yanukovych from power. He was born to in a family of
Jewish-Ukrainian professors of the Chernivtsi University.  From September until November 2001, Arseniy served as an “acting” Minister of Economy of Crimea, and from November of the same year until January 2003, served as the official Minister of Economy of the Autonomous Republic of Crimea.

From November 2003 to February 2005, Yatsenyuk served as the first vice-president of the head of the National Bank of Ukraine under Serhiy Tyhypko. After Tyhypko left the National Bank, Arseniy Yatsenyuk was put in charge of the National Bank.

This is as if Obama was chased from the White House after a few weeks of demonstrations and it was announced that Alan Greenspan was now the president. This marks the second time in two years that a banker has been placed directly in power without being elected, first Italy and now Ukraine.

Well, this should end well. We all know how Eastern Europeans just love rich unelected Jews ruling over them. (Yatseniuk is actually Greek Orthodox, however.) I don’t know Russian or Ukrainian history well enough to know if this is supposed to be revenge for the pogroms or the sort of madness that led to the pogroms in the first place.

Stacking the deck

The mainstream media picks up on a tactic that has been utilized by left-leaning academics for years:

Neither CBS nor ABC have included a skeptical scientists in their news shows within the past 1,300 days, but both networks included alarmists within the past 160 days — CBS as recently as 22 days ago. When the networks did include other viewpoints, the experts were dismissed as “out of the scientific mainstream” or backed by “oil and coal companies.”

The networks were able to promote the myth that there is a scientific consensus for man-made, catastrophic climate change by including climate alarmists much more often than skeptical scientists and by challenging the credentials of the skeptics that they did include.

There are thousands of skeptical scientists, so it’s not like the networks couldn’t find any. Marc Morano, who runs the website Climate Depot, has published a special report listing more than 1,000 dissenting scientists worldwide who dispute man-made global warming claims made by the likes of the United Nations Intergovernmental Panel on Climate Change (IPCC) and former Vice President Al Gore.

CBS was the worst, ignoring skeptical scientists for 1,391 days, ever since the May 15, 2010, “Evening News.” That night, CBS interviewed former NASA climatologist, Dr. Roy Spencer during an extensive profile of alarmist meteorologist, and non-Ph.D., Dan Satterfield.

It was just 22 days ago, on Feb. 12, 2014, that CBS included an alarmist physicist, Dr. Michio Kaku on “This Morning.” Kaku is a contributor to “This Morning” and that day he warned of the “heating up of the North Pole” which “could cause gigantic storms of historic proportions.”

ABC last included a skeptical scientist 1,383 days ago. During the May 23, 2010, segment of “World News,” ABC played a brief, 23-second clip of Princeton-educated Dr. Fred Singer expressing his skepticism over man-made climate change, along with clips of two alarmist scientists. Singer’s was the only opposing view in that report and his views were actually taken from a much earlier interview aired on ABC March 23, 2008.

This reminds me of the way most evolutionists and atheists are always willing to debate some random individual, but are very careful to avoid taking on their more intelligent and intellectually dangerous opponents. For example, PZ Myers has been running away from me for years, despite the fact that he openly issued a challenge and even though my readership has continued to grow steadily while his continues to shrink.

Of course, all this tactic accomplishes is to drive even more people to the alternative media, where the more intelligent and autodidactic readers are increasingly congregating.