July 29, 2008
Apparently they're the worst company in America.  It's worth noting that their business model was heavily dependent on the Government Sponsored Entities – and on the Fed's policy of maintaining very low interest rates for a very long time.  In many ways, Countrywide existed only because government created an environment in which it could thrive – for a while.

Review of "The Way We Live Now" by Anthony Trollope

July 28, 2008
This book, like the other books I've read by Mr Trollope, was a pleasure to read on many levels.  See here for a plot summary and a brief overview of the obvious themes.  Before I begin my review, I'll add that I don't think it was anti-Semitic.  The anti-Semitic parts of Mr Trollope's writing merely reflect the feeling in the strata of society he was writing about.  If this accuracy makes a work anti-Semitic, then every work that is realistic published before our times (before the way we live now, should I say?) is anti-Semitic.  By Mr Trollope's standards our society today would seem incredibly immoral.  Is modern literature therefore immoral?  Such conclusions are absurd.

Mr Trollope clearly wrote this book as a critique of declining morals, which he seems to have believed to be a symptom of increasing worship of money and financial success.  He further seems to have believed that much of the financial success was founded on lying, cheating and borrowing extensively.  So, we have sort of a feedback loop.  Morals decline, leading to increased financial shenanigans, leading to further declines in morals.  Here are some random thoughts:

There seems to have been very little problems like this in Mr Trollope's society.  Clearly the class distinctions were more distinct, but morality (or lack thereof) were not exclusive to any class.  If anything Trollope pins the blame for ruining morality on the high class, but the class interaction is critical to overall decline.  The two pillars of morality in the work are both untitled, though Roger Carbury has land.  The other, Mr Crumb, is a barely intelligible worker.

Mr Trollope, who was a Liberal, seems to be venerating the old.  The work is certainly evidence for Mencius Moldbug's claim that even the most un-Conservative person several decades (or in the case over 100 years ago) would be incredibly reactionary by today's standards.

Throughout the work, with the exception of Mr Crumb's marriage at the very end of the work, the virtuous characters seem to be the most isolated.  On the flip side, the most repugnant (and there are some seriously repugnant ones in Mr Trollope's wonderful cast) seem to get the most attention and the most favor – from all levels of society.

Finally, I think it's worth examining how we "solved" the problem that Mr Trollope was so concerned with – namely financial excess caused by clearly immoral actions (the main financier is guilty of repeated fraud).  We turned to government, and gave it power to tear down financiers.  In the book, after becoming a successful financier, our villain gets elected to the House of Commons.  In a new novel, redesigned to reflect the way we live now, that would have to change.  No one who actually made their own money in finance could get elected to government.  I believe we've traded corruption in finance for corruption in government.  And I further believe that the later is more dangerous.  So much for solutions.  So much for our morality.


July 28, 2008
(the bad kind), from Professor Caplan.

Tyranny and anarchy

July 28, 2008
From Taki:

That guy in the uniform is the representative of the State. The power he wields was delegated by the citizens—but it flows from the justice of God. I don’t think we can do without him. Those of you who think we can should find some depopulated region of Africa or Ukraine and give it a try. Report back to me once you’re done with your seventh civil war—and you’ve installed some Grand Panjandrum to please (please, please!) impose a monopoly of force. You’ll have learned that old, sad lesson: Even tyranny is better than chaos.

Not sure I agree with the God part.  Nor do I agree that a test in Africa or Eastern Europe would be a truly fair test.  Nevertheless, I think the conclusion may be correct.

The US Government and default

July 28, 2008
From Professor Kling:

Consider the long-term obligations of the U.S. government: Social Security, Medicare, the Pension Benefit Guaranty Corporation, public employee pension plans. Add to those the risks of the securities that the government is effectively choosing to guarantee in the Bear Stearns merger, the Freddie-Fannie prop-up, and other steps that are being taken or will be taken in the mortgage and financial market. It seems to me that in order to achieve short-term stability we are piling on long-term fragility.

A lot of my portfolio is in inflation-indexed Treasury securities. At some point, though, I am going to start thinking that there is some default risk in those securities, and I will be looking for a new risk-free asset. My guess is that the closest thing will be a highly diversified portfolio, one that includes a lot of foreign securities.

The Left and democracy

July 27, 2008

The Left, as you know, favors democracy, power to the people, and nondiscrimination, except when it doesn’t. How ironic, or something, that today’s left, which usually prefers to be called progressive, has turned violently against one of the hallmark reforms of the actual, historical Progressives, the initiative process that allows citizens to act as a corrective and check on their government when their elected officials fail to act in what the public believes is its interest.

A defense of predjudice

July 27, 2008
at Anecdotal Evidence

How to find trustworthy news

July 26, 2008
From Former Beltway Wonk

The continuing relevance of Hayek

July 26, 2008
A great post from Professor Somin.


July 26, 2008
Labour as neo-Puritans.