Archive for the Category Misc.


It’s a wonderful, awful, and perplexing life

Time for another Ted talk.  Commenter Ted asked me a bunch of interesting questions, including this:

How you have thought about death and how you wish you thought about death.

This is going to be a long and dreary post, mostly focusing on my “outside view”, which features a rather apathetic attitude toward death.  So let me first reassure my readers that my inside view is much like yours.  If I’m on a Boeing jet plunging toward the ground, I’m going to be screaming in terror with the other passengers. I’m just as horrified by the prospect of death as the average guy.  Woody Allen put it this way:

There’s an old joke – um… two elderly women are at a Catskill mountain resort, and one of ’em says, “Boy, the food at this place is really terrible.” The other one says, “Yeah, I know; and such small portions.” Well, that’s essentially how I feel about life – full of loneliness, and misery, and suffering, and unhappiness, and it’s all over much too quickly.

I’ve been reading My Struggle, Vol. 6, and thus I’ve been thinking a lot about the meaning of life, and also the meaning of death—which sort of seems like the same thing.  AFAIK, death itself is nothing; what seems to matter is the life one misses out on and/or the impact of death on the lives of your loved ones.  Let’s put aside the loved ones for a moment, and think about death selfishly.  Bryan Caplan asks:

Suppose you receive the following option.

  1. You flip a fair coin.
  2. If the coin is Heads, you acquire healthy immortality.
  3. If the coin is Tails, you instantly die.

The expected value of this option seems infinite: .5*infinity + 0 is still infinity, no?  . . .

Nevertheless, I suspect that almost no one would take this deal.  Even I shudder at the possibility.  So what gives?

Statistically speaking, I have about 20 years left.  Putting aside the impact on my loved ones, I’d take that bet in a heartbeat.  But only if the immortality part were eliminated.  Just give me a 50/50 chance at living to roughly 83 in perfect health, then hit by a bus while crossing the street.  The kind of health I had at age 14, or even 24.

Borges once referred to Nietzsche’s eternal return as “the most horrible idea in the universe”.  I agree.  But why is that?  Suppose you had the option of living your life over a trillion times in exactly the same way, each time with no memory of what came before.  Would you take it?  If life is good, then why not?  My visceral reaction is “hell no!” But I’m not sure I can explain why I feel that way.  That thought experiment makes me instinctively recall painful experiences I had earlier in life that I don’t want to relive, not all the pleasant experiences I’ve also had.  I’m not even sure I’m able to think about the thought experiment in the right way.  I am presumably thinking, “once is enough”, but the person being reincarnated would have no memory of previous lives, with previous miseries and blissful moments.

When it comes to life and death, I don’t trust my intuitions.  Am I happy?  It depends on what day you ask me.  Not just in the sense that I may not be happy on a given day; rather on days that I’m unhappy I often think my whole live has been bleak and miserable, and vice versa when I’m happy.  I’m not able to see my life clearly, past my current moods.  Am I more or less happy than other people?  Again, how would I know? I’m an unreliable narrator of my own life.  I’d trust someone else’s judgment of my happiness more than my own.  (Hey, wasn’t that once a corny movie?)  With the exception of Karl Ove Knausgaard, I don’t know what it’s like to be anyone else but me.  Are Karl and I unusually moody Nordics?  Or typical people?

BTW, here’s Knausgaard describing how he’s viewed by his best friend:

[Geir] took all of this and composed a picture of my psychological and social character he then analyzed and discussed.  He construed me as a kind of baroque entity, abnormal and warped, whose inner being was utterly out of sync with its outward expression — completely the opposite of how I saw myself, which was ordinary to the point of self-erasure

Literary critics have paid too little attention to the role of this fascinating friend, who even came up with the near perfect title of Knausgaard’s book.

In previous posts, I’ve remarked that my “outside view” rejects concepts like objective truth, free will and personal identity.  In contrast, my inside view of this stuff is just like yours.  Because my outside view tells me that personal identity doesn’t exist; there is actually no “me” to die.  There are a bundle of thoughts that will no longer swirl around in my brain, but billions of other people will still have similar thoughts.  No great tragedy.  My inside view that my death would be a much greater tragedy than the death of a random 63-year old shepherd in Turkmenistan is an illusion, reflecting the bias of my own perspective. (Yes, I know, my language implies the existence of personal identity; I know of no other way to write.)

Think about the Edmund Spenser line:

Sleep after toil, port after stormy seas, Ease after war, death after life does greatly please.

This is why I find the concept of immortality (or the eternal return) to be so frightening.  I fear (and expect) something like the end of the film Avatar, where death is immediately followed by rebirth into another body.  No rest for the weary.

In a book entitled Why Buddhism is True, Robert Wright remarked:

I asked [Gary Weber] about a line of his I recall reading, something to the effect of: The bad news is that you don’t exist; the good news is that you’re everything.

That latter claim is not good news to me. I don’t want to be Donald Trump, much less a trillion future Trumps, but I fear that Weber is right.  Without personal identity, we’re everybody.  Wright also says:

Meditation can weaken the link between perceptions and thoughts, on the one hand, and the feelings, the affective resonances, that typically accompany them on the other.  Well, if you do a really thorough job of that weakening, and perceptions become increasingly free of affective associations, this could change your view of the world.  It could leave things looking the same on the outside but seeming as if they lack some inner something.

I’ve never done meditation, but that sounds like growing older.  When I went to Wisconsin basketball games at age 16, there were times late in the game when the entire arena seemed to be pulsating with swirling, delirious waves of energy, which went right through my body.  The noise was deafening and the players and the crowd were almost one in the same.  Now I’m more analytical, watching games on TV and noticing whether teams are playing “moneyball” by avoiding mid-range jumpers.  (Thank God for Coach Budenholzer!)

It seems to me that nature prepares us for death with a series of “little deaths”. (No, not in the French sense!)  As we get older, our earlier selves are repeatedly shed like the skin of a snake.  These are the little deaths.  Life is gradually drained of magic and meaning—we get wiser and grayer. We keep repeating the same basic experiences, but each time with a bit less “color”.

About 25 years ago I bought a vintage French railway poster.  Unfortunately the skin tones gradually faded from tan to grey.  I never noticed this until I recently saw a clean copy on the internet.   So I went onto eBay and bought a fresher copy, had it delivered from France, and put it in an expensive frame with UV protection.

Screen Shot 2018-10-16 at 3.19.35 PMOf course my wife thought I was crazy to spend all this money in an pathetic attempt to reclaim the color of my earlier life.  (Or maybe she saw something ominous in my desire to trade in old grey skin for young tan skin, noticing that I’ve recently been reading a Michel Houellebecq novel.)

So why keep living, with such a dreary attitude toward life?

1. Option value.

2. Most importantly, for my loved ones. (And let’s face it; that means one’s spouse.  Others may pretend to care, but at my age only one person is severely impacted by my death.)

3.  Still some good films and novels to see and read. Last week I took delivery on a 77 inch LG C8 OLED TV.  I can finally watch films at home.

4. To see how Giannis’ career plays out.

Remember, evolution doesn’t want us to be content; it wants us to struggle.  But it also wants us to hate dying, even if we are not content with life.

Recall Dylan’s line:

But it’s alright, Ma, it’s life, and life only.

PS.  I didn’t answer the second part of Ted’s question.  How do I wish I thought about death?  Like a Buddhist.  Maybe I need to start meditating.

File under “All knowledge is provisional”

We used to think that the shape of a man’s skull correlates with his character.

Then we discovered that that’s actually not true; phrenology is fake science.

Then we discovered that the shape of a man’s skull actually does correlate with his character:

The new Caltech study is the first to show that observers have a knack for picking out corrupt politicians based on just a portrait and that observers perceive politicians with wider faces as more corruptible.

All knowledge is provisional.  As Richard Rorty observed, truth is that which we regard as true.

Of course no good blog post is complete until it includes an appropriate picture:

Screen Shot 2018-10-10 at 1.07.29 PMPS.  How about me? I think I’m a bit more corrupt than Obama, but less corrupt than Trump, but it’s hard to judge one’s own face.  Any thoughts?

PPS:  Yikes!

PPPS:  Lighten up everyone, this entire post is meant to be a joke.  I know that the correlation is quite small and only shows up with large data sets.

HT:  Scott Alexander

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.