Archive for the Category Misc.

 
 

What do we mean by meaning?

A commenter named Ted asked me some interesting questions:

Topics/prompts that I’d be interesting in reading your thoughts on:

-What determines the risk-free rate?
-Where have you found meaning in life?
-How do you think historians will look back on this period?
-What will money look like in 100 years? In 1,000 years? In 10,000 years?
-What’s a book or TV show or movie or podcast you liked? Why?
-How do you fight against selection bias as you consume information about the world?
-What are topics we should be talking about more?
-Maybe a high-level tour through periods in history that illustrate something about monetary policy (aimed at people like me who are too lazy to read books where this already written down)
-What are topics you wish you knew more about?
-What are questions that are both important and difficult to answer?
-What constitutes your information diet? What sources of information do you strongly recommend?
-More posts on how public opinion isn’t real (for me, this was a big takeaway from your writing)
-Thoughts on macro hedge funds
-How you have thought about death and how you wish you thought about death
-Questions that you have for your readers

That gives me ammunition for a number of “Ted talks”.  I’ll start with meaning, as I’ve recently been reading a book on psychedelics that touches on that subject.

Let me begin by noting that I often have a sort of “inside view” and an “outside view”.  Thus my inside view is, “of course I have free will” and my outside view is, “of course free will doesn’t exist.”  Similarly, my inside view of meaning is probably not too dissimilar from the views of others, while my outside view is that meaning doesn’t exit.  Life is just one damn mental state after another.

With free will, my outside view is not just that free will doesn’t happen to exist, but that something like that can’t possibly exist.  Similarly, my outside view is that meaning can’t possibly exist.  Since my outside view is uninteresting, and a bit depressing, I’ll focus the rest of my post on my inside view.

Because of my outside view, I prefer not to talk about “finding meaning”, as if there is something out there to me found. Rather I’d prefer to say “seeing meaning”, which implies meaning occurs in our minds.  I’ve long believed that the very young see more meaning in life than older people, and that meaning gradually drains away as you age.  Meaning is also more likely to be visible in dreams, and (I’m told) in psychedelic trips on LSD or mushrooms.

This quote from a book by Karl Knausgaard nicely captures the way meaning drains away from life as one ages:

You could still buy Slazenger tennis rackets, Tretorn balls, and Rossignol skis, Tyrolia bindings and Koflach boots. The houses where we lived were still standing, all of them. The sole difference, which is the difference between a child’s reality and an adult’s, was that they were no longer laden with meaning. A pair of Le Coq soccer boots was just a pair of soccer boots. If I felt anything when I held a pair in my hands now it was only a hangover from my childhood, nothing else, nothing in itself. The same with the sea, the same with the rocks, the same with the taste of salt that could fill your summer days to saturation, now it was just salt, end of story. The world was the same, yet it wasn’t, for its meaning had been displaced, and was still being displaced, approaching closer and closer to meaninglessness.

Of course there are also some consolations that come with age.

Compared to most people, I probably find less meaning in success and fame, and more in art.  At least that’s how it seems to me.  I’m probably about average for seeing meaning in friends and family (although given my Northern European cultural heritage, perhaps a bit less than average for family.)

During my career, I noticed that some colleagues cared a lot about things like promotions, whereas I didn’t care at all.  I did get some satisfaction from the positive press I got in September 2012, but probably less than most people would.  I’m not ambitious in a career sense.  If given the opportunity to be Fed chair, or a senator from California, or CEO of Goldman Sachs, I’d immediately turn down the opportunity.  If not for this Mercatus position, I’d already be retired—at age 62.  I’d rather make $20,000/year and have the health I had at age 31, than $200,000/year and have the health I have today—and I don’t even have any serious health problems, just chronic annoyances. That’s why the income inequality debate doesn’t really resonate with me; it just doesn’t seem that important.  (That’s my impression; I’m not trying to defend it.) On the other hand, extreme poverty in developing nations such as North Korea seems like by far the most important problem in the world.

I also find much less meaning that usual in ceremonies such as funerals, weddings, graduations and other such events. I’m not a social person.

When I was a young academic, my research was meaningful to me.  As I got older, I realized that people simply didn’t care and it lost meaning.  What made my depression book so hard to write is that I did it after I’d become disenchanted, after I realized the book would be ignored.  Fortunately, the hardest part (all the research) was done by the time I reached that view, but it was still an agonizing process to write the book.

Conversely, I got a lot of meaning out of a brief summer course I taught at Cato this summer.  I was great seeing younger students from really good schools that were interested in market monetarist ideas.  My blog also gave me meaning, especially during the early years when I still had new things to say and the readership was larger and more engaged.  I still have modest hopes for my blog book, but I don’t think book length projects are my forte.  If I were actually able to influence Fed policy, that would seem meaningful to me.

For me, the greatest meaning in life comes from art, broadly defined to include aesthetically beautiful experiences with nature, old cities, and scientific fields like astronomy and physics.  The most meaningful experience in my life might have been seeing the film 2001 at age 13.  I’ve never tried LSD, but after reading about the experience it reminds me of this film, and indeed the director was someone who experimented with acid.  (It might also be the only “psychedelic” work of visual art that’s actually any good.  Whereas pop music from the 60s is full of good examples.)

To me, art is “real life” and things such as careers are simply ways of making money in order to have the ability to experience that real life.  After art, I’d put great conversation second on the list.  And the part of economics that most interests me is the ability to converse with like-minded people (such as at the Cato summer course.)

I’m sort of like a satellite dish, receptive to ideas and sounds and images.  My ideal is Borges, who regarded himself more as a great reader than a great writer (of course he was both, and a great conversationalist.)  I’d rather be a great reader than a great writer.  I’d rather be able to appreciate great music than be able to produce it.

I’m not at all like Trump.

PS.  I’ll answer some other Ted questions in later posts, here and at Econlog.

The economy is doing fine (as it was 16 months ago)

Lars Christensen is now doing videos at Patreon.  Check it out.

Also check out my new post at Econlog, where I express skepticism about whether Japan is a “safe haven”.

So how’s the economy doing over the past 16 months?  Here’s RGDP growth:

Screen Shot 2018-05-12 at 11.38.06 AMThat’s better a bit better than before.

Here’s employment growth (annual % change):

Screen Shot 2018-05-12 at 11.39.06 AMThat’s a bit worse than before.  Yet the unemployment rate is falling, as it has been for 8 1/2 years.

Here are real wages (deflated by the PCE):

Screen Shot 2018-05-12 at 11.36.30 AMStill rising modestly, as before.

Here is the trade deficit:

Screen Shot 2018-05-12 at 11.40.46 AM

Worse than before, as expected.

Here’s the stock market:

Screen Shot 2018-05-12 at 11.48.27 AM

The bull market continues.

Conclusion.  We are still in the Obama economy, with the possible exception of RGDP growth, which seems a bit stronger.  Otherwise things are about the same.

Prediction:  RGDP growth will stay around 3% for a couple more quarters (reflecting the corporate tax cuts and Fed easing), and then fall back below 2%.

Odds and ends

I have a short piece over at CapX, where I make the case for NGDP targeting.  (You can think of it as complementing my recent longer piece on the subject.)  Here’s how I conclude:

Economists are beginning to understand that NGDP is the variable we should actually be concerned about. Instead of worrying about what might happen to inflation under NGDP targeting, we should consider what happens to NGDP if we insist on targeting inflation.

I leave for Japan tomorrow, so I won’t do much blogging in April.  And most of what I do write will be over at Econlog.  Here are a few interesting pieces I recently came across, starting with an analysis of the new GOP budget:

It fully funds Planned Parenthood. It increases outlays for Pell Grants and Head Start, and boosts funding for the Department of Labor and the Department of Education not only above the requests Trump had made, but above the levels in Obama’s last budget. It fails to deregulate the private health insurance market or to reform federal permitting rules on construction projects. Not a single agency was eliminated, though Trump’s original budget proposal had called for 18 to be scrapped. It makes no changes to entitlement programs, and oh, here’s something interesting, it actually forbids construction of a border wall in the Santa Ana National Wildlife Refuge in the Rio Grande Valley — the very place Trump supposedly wanted to begin construction.

This article suggests that refugees are good for America:

This year’s refugee quota, 45,000, is the lowest in three decades, and is not expected to be met. Mr Trump also excluded a lot of wretched people from it, by temporarily placing additional restrictions on anyone from a secret list of 11 countries, which is said to include South Sudan, as well as Syria and Iraq. A low-cost nativist signal to his supporters, these are the biggest changes Mr Trump has made to America’s immigration regime. They are also counter-productive, as well as cruel, a typical case of nativists mistaking American strengths for weakness.

The argument against refugees, which Republican governors in Texas and Michigan were making even before Mr Trump’s election, is that they are a financial burden and security threat. Both charges are unfounded. For though it is true that refugees represent a bigger upfront cost than other migrants—America spends between $10,000 and $20,000 resettling each one—they repay that in spades. A decade after their arrival, the average income of a refugee family is close to the American average. Mr Makender has paid over $100,000 in taxes. Americans can also relax about their odds of being killed by a refugee. None of the 3m-odd fugitives America has taken since 1980 has been involved in a fatal terrorist attack. That reflects the rigour of America’s vetting, refugees’ hunger for advancement—and America’s ability to feed it.

This article on teenagers in Russia (called “Puteens”) makes me more optimistic:

The internet unites the human race

This heightened sense of the world beyond their borders seems to make the Puteens more receptive towards it. The dynamic of constant confrontation with the West holds less appeal for them. Russia’s youngest adult cohort is more likely to have positive views of America and the European Union, and less likely to believe that Russia has enemies. (Their peers in the West also view Russia more favourably than older generations do.) They trust information from friends and relatives, and increasingly eschew the aggressive state-controlled news on television. Over 70% of 18- to 24-year-olds get their news online, compared with just 9% of those over 55; more than 90% of over-40s still rely on television. “They try to convince us that Americans all hate us; that Americans think Russia is a place full of evil people, bears on the streets and vodka,” says Lera Zinchenko, an aspiring actress from the Moscow suburbs. “I don’t think they hate us. I follow a few people on Instagram who travel all over the world, and there’s one girl who was in America and said people were super nice to her.”

This article suggests that China is becoming more like the West:

Start with administrative litigation, which usually involves private citizens suing government officials. Last year courts agreed to hear 330,000 such cases, more than double the total in 2013—the first full year of Mr Xi’s rule (see chart). Many of these involve disputes over land and housing, the most frequent sources of conflict between ordinary people and the state. Other common cases relate to pension benefits, compensation for workplace injuries and traffic tickets. Benjamin Liebman of Columbia Law School says that suing the government over such matters is becoming routine in China.

There have also been notable improvements in the arena of commercial law. Last year Chinese courts began hearings in 152,000 intellectual-property disputes, up nearly tenfold over the past decade. The explosive growth in IP cases has been fuelled by the growing litigiousness of domestic companies, which have more to protect as they become more innovative. But foreign companies are also benefiting. In August a court ordered three Chinese firms to pay 10m yuan ($1.5m) in damages to New Balance, an American footwear company. It was one of the largest trademark-related awards ever made by a Chinese court.

And don’t be overly depressed by the rise of right-wing authoritarianism.  At the global level, things are still getting much better.  This article discusses the dramatic rise in fish farming in Bangladesh, as well as fast rising chicken production in Nigeria.  The bottom line is that the great mass of humanity is seeing a dramatic increase in living standards:

However much farmers struggle with the consequences of their success, it is a far nicer problem than the one they used to grapple with. Walking down a market street, Mr Haque dips his hand into a sack of maize and a sack of rice. The grains will be bought by farmers, who will grind them into pellets for fish and cattle. “Twenty-five years ago, people were starving for want of this,” he says, marvelling. “Now we feed it to animals.”

If you are depressed about the world, that’s a reflection of you, not the world.

Odds and ends

1.  In a recent post, I asked people why I should be impressed when people tell me that conservative judges are being appointed.  After all, I’d not impressed if someone tells me they know a conservative plumber.  Alex Tabarrok has a couple of recent posts that help to clarify my thoughts on this issue.  Before discussing the posts, let me emphasize that I am not a legal expert.  But that disclaimer cuts both ways.  If I’m not even smart enough to understand the issues that Alex raises, how could I possible be expected to have an intelligent (and positive) opinion of “conservative judges”?

Alex points out that in many states the police are given legal protections that other Americans do not have.  Thus if they are arrested for a crime, they cannot be vigorously interrogated, in the way that an ordinary person is questioned.  On the face of it, that would seem to violate the “equal protection” clause of the 14th amendment.  Why should some Americans be denied legal rights available to others?

So here’s where the conservative judges come in.  How come I never read about conservative judges upholding the Constitution by striking down these violations of the equal protection clause?  I’m not saying that conservative judges never make “liberal” rulings.  In some obvious cases, such as flag-burning, conservatives did uphold the 1st amendment.  (Of course in this period of radical left-wing speech codes, the 1st amendment is being increasingly viewed as a right wing idea, similar to the 2nd amendment.)  But overall, when I read articles about how conservative justices rule, it usually tends to favor policy outcomes that are “conservative”.

2.  I recently did a post showing how pessimism is intellectually fashionable.  Another good example of this problem is Greece’s supposedly “unpayable” public debt.  I’ve always been skeptical of the claim that Greece’s debt was unpayable.  To me, it seemed more a question of the Greek’s not wanting to repay the debt.  Like a number of other European countries, Greece’s government spends over 50% of GDP.  But you can have a perfectly fine Western social welfare state spending far less (say 30% to 40%), as we observe in both rich countries like Australia and Switzerland and poorer countries such as Estonia and Slovakia.  If Greece reduced the non-interest part of its spending down that range, it would be able to divert enough funds to service its debt.

I have not followed events in Greece, but I do notice that yields on Greek debt are now plummeting, to levels suggesting that Greece is not likely to default on its debt.  I did a post last May that pointed out that the debt market’s implied probability of default had fallen to 40%.  Since then, bond yields on Greek public debt have plunged to well below 4%, 200 basis points below the levels of last May.

That does not prove that Greece will not default on its debt, rather that default is certainly not inevitable.  Once again, the pessimists were wrong.  And once again the good news got almost no press attention, while the previous bad news got headlines in the “serious” international media.

If you form an opinion about the world by consuming the media, you will be consistently wrong about things.  Your views will be too pessimistic on issues where the media is already pessimistic, and perhaps a bit too optimistic in areas receiving no media attention, but where a “back swan” could appear suddenly.

3.  In an opinion piece in the NYT, Angus Deaton made the following claim:

This evidence supports on-the-ground observation in the United States. Kathryn Edin and Luke Shaefer have documented the daily horrors of life for the several million people in the United States who actually do live on $2 a day, in both urban and rural America. Matthew Desmond’s ethnography of Milwaukee explores the nightmare of finding urban shelter among the American poor.

It is hard to imagine poverty that is worse than this, anywhere in the world.

A person may have difficulty imagining far worse poverty levels in other countries, but that’s not because they do not exist.  In fact, the bottom 2% of the world community is so much worse off than the bottom 2% of Americans that they might as well be living on different planets.  For people who don’t understand this fact, I’d suggest they read more about what life is really like for the world’s poorest people in places like Congo, North Korea, Somalia, Mali and Yemen.  (I’m actually pretty surprised to read this comment from Deaton, who’s an expert on poverty.)  Or read a book about the Great Leap Forward.

4.  Unlike me, Ross Douthat does not suffer from Trump Derangement Syndrome.  Indeed he writes opinion pieces that are 10 times more thoughtful and 100 times better written than the trash in this blog. I agree with almost everything is this brilliant essay:

And where an abnormal response to Trump has kept things on an even keel, it hasn’t been furious protests; rather, it’s been a collective decision by many different actors, from his own appointees to his congressional opponents to foreign leaders the world over, to simply behave as if he isn’t actually the president, as if the system around him is what matters, and his expressed desires are just a reality TV performance.

So why will some readers be surprised by my claim that Douthat and I agree?  Because it looks like we disagree:

Me:  THE TRUMP PRESIDENCY IS A COMPLETE $&%@&# FARCE!!!!!!!!!!!!

Douthat:  Calm down folks, the Trump presidency is not a tragedy, just a farce.

Like I keep saying, don’t be fooled by framing effects.

There is one silver lining to Trump—he triggers some truly inspired writing.  Kevin Williamson is one of the best.

5.  I recently did a post on the rise of racism in the conservative movement.  Others are seeing the same thing:

That says a lot about the conservative movement. Intolerance always existed within it, but part of its success was how it managed to suppress the appearance of intolerance, to hide it behind terms and ideas that masked the movement’s true motivations. [William] Kristol said that those elements were “less healthy than I thought or hoped.”

Those elements started to come forward in the 1990s, Kristol said, starting with Pat Buchanan and continuing with Trump. “He’s an effective demagogue,” Kristol said of the president. “And then the rationalization of Trump, acceptance of Trump by so many Republicans and some conservatives, including conservatives I worked with and respect, has been disturbing to me.”

Kristol’s lament echoed what conservative commentator Charlie Sykes told Andrew O’Hehir in October 2017. “I knew that it was there, but I did think it was the drunk at the end of the bar, or it was your bigoted uncle at Thanksgiving,” he said. “This was a fundamental moral failing [of the conservative movement] that we did not draw the line on things like that. And as a result, that kind of racism, those conspiracy theories, that paranoid style festered. And it festered to the point that we can no longer control it.”

6.  My 12 recommendations for better living:

1.  Lead by example, don’t tell other people what to do.  (I.e. Tyler’s best advice is his life, not his list.)

2.  Don’t emulate me.

3.  Don’t write a principles of economics textbook.

4.  Don’t be born in North Korea.

I’m still working on the other 2/3rds of my list.

7.  It’s happening.

Another “bad hombre” being deported

From the Detroit Free Press:

His wife, Cindy Garcia, cried out while his daughter, Soleil, 15, sobbed into Garcia’s shoulder as they hugged. Two U.S. immigration agents kept a close watch nearby.

After 30 years of living in the U.S, Garcia, a 39-year-old Lincoln Park landscaper, was deported on the Dr. Martin Luther King Jr. holiday from metro Detroit to Mexico, a move supporters say was another example of immigrants being unfairly targeted under the Trump administration.

Jorge Garcia was brought to the U.S. by an undocumented family member when he was 10 years old. Today he has a wife and two children, all of whom are U.S. citizens.

Remember when Trump said he was going to focus on the “bad hombres”?

His supporters say he has no criminal record — not even a traffic ticket — and pays taxes every year. . . .

Garcia is too old to qualify for DACA, which allows the children of undocumented immigrants to legally work and study in the U.S.

A question for restrictionists.  How about a person who came to America illegally at age 2, and was 93 years old.  Assume no criminal record.  Should she be deported?  If so, why?  If not, why should this guy be deported?

“It’s heartbreaking,” Bonesatti said. “If you’re going to pick someone who’s ideal,” he would be it. . . .

Moreover, Mexico is a foreign place to Garcia.

But at least Trump is reducing regulations on coal companies that want to poison our air and water, so everything’s fine.

PS.  I’m guessing that the truly bad hombres don’t dutifully report to the immigration authorities like this guy did:

She said that when her husband reported to ICE in November as part of a regular check-in, he was informed that he had to leave the U.S. and would be detained immediately.

PPS.  Over at Econlog I have a new post on the war on drugs:

As a candidate, Trump promised to leave the marijuana question up to the states. In his confirmation hearings, Jeff Sessions promised not to make marijuana a priority for federal law enforcement. It turns out that all of those promises were meaningless.

PPPS.  And speaking of Trump, I don’t agree with every single charge on this NYT list, but the cumulative impact is pretty convincing.