Around the Traps 11/10/13

It is time for Around the Traps again.

I am coaching cricket on Saturday morning and umpiring on Saturday afternoon and I am sharing a Rosemount Balmoral on Sunday Lunch with an old mate so I may have to update on Monday!!

For Stats junkies Andrew Gelman and the cleanshaven  business suited Dave Giles are in sparkling form. ( there appears to be over a 1,000 people in OZ who love Dave besides me!)
The Evergreen David Glasner is wonderful on his latest tome on Hawtrey. Simon Wren-Lewis writes about Austerity again and in  Vox there is a great article on World Cup football and game theory. However its all good!
UPDATE
Noah Smith writes from his hiatus!

Updated on Sunday!

enjoy

Aussie,Aussie,Aussie,Oy,Oy,Oy

• Peter Martin on never-ever-take-dietary-advice-from-the-softdrink-industry
• Ken Wollf on How-the-west-was-NOT-won-by-Murdoch
• Matt Cowgill on statistics-at-the-mercy-of-a-slanted-interpretation
• Ross Gittins on gas-lobby-working-scam-on-nsw-citizens
• Ricardian Ambivalence on mccrann-riffs-on-yellen, the-good-the-bad-and-the-ugly-sep-jobs-edition
• Harry Clarke on daft-coalition-economics-5-poor-bargaining-instructions-on-a-trade-agreement, daft-coalition-economic-policies-6-endorsing-sleazy-behaviour-lying-about-it
• Paul Fritjers on occupational-wages-in-australia-2002-2012
• Mumble on historical_election_results
• Kevin Bonham on 2pp-aggregate-restarted-transitional
• Mark Banisch on australia-needs-an-inquiry-into-parliamentary-expenses-and-transparency-and-reform and tim-dunlop-on-tony-abbotts-press-gallery-cheer-squad
• John Quiggin on a-rocky-start, can-you-run-an-ironman-and-run-a-country
• Grog's Gamut on australias-unemployment-rate-steady-at-5.7%  and Mark the Graph on unexpected-bounce-in-employment
• David Walker on swans-legacy-hockeys-ally
• Andrew Elder on competence-discipline-strategy-and-timing
• The political sword on Tony-Abbott-Cone-of-Silence

Canada and something shutdown

• Josiah Neeley on in-defense-of-constitution
• Jim Devine on nber-recessions-vs-actual-recessions_4
• Ricardian Ambivalence on troublesome-t-bills and then Menzie Chinn on movements_in_short_term_treasuries Kruggers on are-treasuries-terrifying?
• Mike Konzal on what-are-conservative-experts-saying-about-breaking-through-debt-ceiling
• Kruggers on the-midterms-sam-wang-weighs-in, the-debt-ceiling-and-the-housing-bust ( has link to automatic stabilisers comment)
• Menzie Chinn on measuring_the_trielemma, flying_blind
• Mark Thoma gives us Tim Duy on fed-watch-credibility-on-the-line, fed-watch-fomc-minutes-overtaken-by-events, fed-watch-kind-of-a-clown-show
• Brad De Long on peter-gosselin-exchange-competition-cuts-health-insurance-costs-noted
• Calculated Risk on comment-politics-policy-deadbeats-and-default
• Macroblog on delving-into-labor-markets
• Skeptikoi on the-commitment-phobic-fed
• James Hamilton on an_exit_strategy_for_Republicans

Europe

• Jon McHale on paul-krugman-on-expansionary-creditworthiness-shocks, some-further-thoughs-on-expansionary-sovereign-creditworthiness-shocks
• Jonathon Portes on fiscal-consolidation-and-growth-whats-going-on

Asia

• Mark Thoma on japan-rising-shinzo-abes-excellent-adventure

Wonk

• Antonio Fatas on underestimating-economic-potential-as-a-justification-for-inaction  Thanks Mark
• Edward Lambert on an-is-lm-look-into-the-future, john-williams-not-say
• Nick Rowe on private-debt-public-debt-and-continuity
• Peter Dorman on borrowing-from-future-except-that-we-aren't, Nick Rowe on degrees-of-freedom-forward-guidance-and-rules 
• David Glasner on hawtreys-good-and-bad-trade-part-v-did-hawtrey-discover-ppp , a-new-paper-shows-just-how-right-hawtrey-and-cassel-were
• Simon Wren-Lewis on bank-deleveraging-and-productivity, why-i-am-obsessed-by-austerity
• Simon Wren-Lewis on nominal-wage-rigidity-in-macro and then  Kruggers on sticky-wages-and-the-macro-wars and again wage-flexibility-in-doctrine-and-policy-wonkish

General

• Chris Dillow on complexity-alienation, ignore-the-newspapers, low-skills-why-worry, abundance-revolution
• Kevin Quinn on reification 
• Angus Deaton on on_weights_and_coding_errors
• Nick Rowe on degrees-of-freedom-forward-guidance-and-rules
• Mark Thoma on an-experiment-puts-auditing-under-scrutiny
• Brad De Long on you-dont-need-a-rigorous-microfoundationeer-to-know-which-way-the-well-to-know-much-of-anything-really, the-important-takeaway-from-ken-rogoffs-latest-is-that-he-agrees-with-us-that-since-the-start-of-2010
• Noah Smith on the-ferg-beast-attacks

Brian Banisch ( Climate)

• climate-clippings
• commentary-on-ipcc-wg1-part-2
• Steve from Brisbane on tony-responds

Andrew Gelman ( Stats stuff)

• bing-is-preferred-to-google-by-people-who-arent-like-me
• a-bayesian-approach-for-peer-review-panels-and-a-speculation-about-bruno-frey
• mister-p-whats-its-secret-sauce
• chris-chabris-is-irritated-by-malcolm-gladwell
• gladwell-vs-chabris-david-vs-goliath
• visualization-big-data-and-eda
• new-issue-of-symposium-magazine-2
• Good Stats Bad Stats on Probabilities on Tropical Storm Karen., 100% refund if no snow

Dave Giles ( Econometrics)

• a-regression-estimator-that-minimizes-mse
• society-for-economic-measurement
• a-second-lesson-in-econometrics
• the-history-of-statistics-in-classrom
• so-much-good-reading
• blogs-on-resources-for-economists see what occurs when you have no mo and dress in a suit!!
• beyond-mse-optimal-linear-regression
• seven-deadly-sins
• do-better-economic-models-lead-to-better foerecasting
• project-based-learning-of-modern-econometrics

Dianne Coyle & Frances Woolley (quirky + book reviews)

• Dianne on integration-of-the-social-sciences, iconoclasm-incoming, obsolete-social-capita, liberty-and-reality
• Harry Clarke on what-i-am-reading-murdoch

Voxwonk

• should-ecb-minutes-be-published
• international-cooperation-and-central-banks
• how-make-europes-incipient-recovery-durable-rejoinder
• system-wide-exposures-emerging-markets
• stalin-and-soviet-industrialisation
• eu-us-trade-deal-good-or-bad-rest-world
• world-cup-football-and-game-theory
• measuring-competitiveness-world-global-value-chains
• institutions-and-ethnicities-africa
• easy-access-cannabis-tempting

Is Steve Kates delusional or simply an Idiot?

We are used in data free irrational rants from Steve Kates but yesterday he went into overdrive.

He 'looked' at Greece and suggested that the reason Greece was about to experience growth for the first time since 2008 was because the budget was being balanced.

Well I went and looked at the latest IMF report.

Wow guess what it showed a lot of what Kates said was complete and utter cobblers.

First let us go through what Keynesian economics would say about Greece.
Given the private sector has been contracting ever since the GFC any Government imposing austerity would make the economy worse . This occurred.
It would only get weaker if the CHANGE in the structural part of the  budget was larger than the year previous. This occurred.If the change is smaller then it would be positive for the economy.
see Here for example. update This is even better

Kates then goes on to say even though there has been no growth since 2008 this only occurred in the public sector. The private sector continued to grow. Now dear reader when you examine the data in the IMF report can you see this? No? No-one can. Kates is simply making stuff up as he always does.

Have a look at the private sector in terms of consumption and investment. When does it become positive . Around 2015 as the IMF projects after a tentative recovery in 2014.

If the private sector was in such a healthy state wouldn't investment be rising over that time instead of FALLING?

This is another of the Kates fictional stories like the 10 fiscal stimuli's that never occurred in Japan during the 90s or the only reason classical economics has never worked was because all the statisticians were Keynesians!

Put Kates in a white jacket ans stick him in a mental institution. The man is seriously deranged and has no idea of reality!

And yes you can tell I'm bored!


UPDATE

An e-mailer makes the valid point if Kates is to be consistent about Austerity promoting growth in a recession then why did it take so long?
I am afraid Kates has never been consistent except in being wrong!

Castle: A debate about Andrew Marlowe

The Lovely Lady from Writing on the Castle Walls has written a lengthy answer to a very good question HERE.

I would like to explore the issues here as Fans in Castledom are split over Andrew Marlowe. The Lovely Lady is most definitely a fan and I am no longer.

So here goes.
Just before that however my feelings on    castle-is-it-about-to-jump-shark, castle-beckett-watershed-dc-job-and-rest and castle-questions-and-some-advice-for-Andrew Marlowe.

Okay now whose show is it?
Once the show hits the TV screens it is the fans show. It is a bit like football. The team I support in MY team.
As such the fans always deserve their questions to be answered. At this stage the major questions from the final arc of series 5 have not been answered.They can't all be answered on the screen because of time constraints but surely the Paley panel is the ideal time to do that. But all questions and anger of the final arc of series 5 were totally ignored.
This merely intensifies feelings that they didn't realise the extent of the mistakes they made in the  episodes.
The best example of this is the suddenness of Beckett being an idealistic homicide detective and then hey presto she is an ambitious career driven woman. Why did this occur, how did this occur, when did this occur? We still do not know yet it is intrinsic to the final arc.

Before we examine the job in DC let us decide on what is bad writing.
 I think the best description of bad writing involves the writers writing something that is completely inconsistent and contradictory to the 'canon' of the series. It would also involve being lazy in research.

Now the job in DC was seen by most fans as fictional. Afterall you can't have it being an Agency then a Task force and then the Deputy Director of the FBI ringing up Gates if it wasn't!
However Castle fans are used to a reasonable amount of authenticity.
Here are just some of the problems emanating from the job.

• A job which is involved in national security would not have people being invited to an interview. They would have to apply.
•  A person who ONLY had experience in homicide would be rejected.
• Any applicant would have a large dossier on them.
• In Beckett's case there would be a HUGE red light on why she was suspended. When they learn't she went rogue she would be rejected.
• All applicants would be screened for psychological tests and as well as being examined on their record. It would not take long for Beckett to be screened out because of her emotional and psychological empathy for the victims of murder. we actually see this in episode 3 of series 6.
• They would know she had no partners before Castle and examine carefully why Castle was the only partner she ever accepted.

Hence even if you take poetic licence to its most extreme and imagine Beckett would be interviewed for the DC job no competent interviewer would offer her the job.

The fact she accepts the job offer means she has absolutely no self awareness at all.
The fact she was offered the job shows that the interviewer was totally incompetent.

The fact that Beckett accepts a marriage proposal and then in the next second tells Castle she has accepted a job offer which is incompatible with that acceptance shows Beckett to be quite selfish and self-centered however her background of both getting her Father off the demon drink and her sense of justice for victims shows her to be very altruistic!

The fact that Series 6 shows Beckett only realising the problems of the job in terms of the Caskett relationship, of having a different partner, of homicide being totally different to issues of national security means she put no forethought at all into what the job would mean to her and to her relationship with Castle.. In other words Marlowe and co have shown Beckett to be quite stupid and fickle.

This puts people such as the lovely Lady who are Marlowe lovers in a quandary.
Either Marlowe and co are good writers and Beckett is both selfish and stupid or she isn't and the writers have been poor writers since the final arc. They cannot have it both ways.

As ALWAYS ( Castle pun intended)

The mess in the USA

What is it about the USA that makes the politicians over there so stupid.

'Obamacare' is law. It has passed both houses ans was signed into law by the President. It passed muster by the Supreme Court.
Now the Republicans want to deny it any money.They want to discuss changes to it with the President.

Fellas you do this BEFORE the bill is approved NOT after.

If you couldn't make any substantial changes to it before it became law then that is tough titties!

In the last election Republicans lost the vote for the President, in the Senate and the House of Representatives.

AND you think you have a mandate to change Obamacare?

I think you should be prosecuted for smoking illegal substances!

Update
I have been asked what Obamacare does to the budget. It helps reduce it!

John Lee Hooker

Here is the great man live his almost his signature song Boom Boom!

Around the Traps 4/10/13

It is time for Around The Traps again this week.
A chastened Dave Giles has been furious on his blog this week if you like econometrics!

It is a long weekend in Sydney so I will update until Monday night. Cricket on Saturday and dinner guests on Sunday so the updating could be a bit scratchy.


Aussie,Aussie,Aussie,Oy,Oy,Oy

• Harry Clarke on fiscally-conservative-labor-the-spendthrift-coalition, privatizing-australia-post
• Matt Cowgill on the-latest-attack-on-the-fair-work-act 
• The Piping Shrike on action
• Ricardian Ambivalence on rba-sees-policy-gaining-traction
• Peter Martin on there-wont-be-any-more-rate-cuts-this-year
• Mark Banisch on the-contradictions-of-direct-action
• Andrew Elder on before-fall
• Ken Parish on shock-horror-i-agree-with-greg-sheridan

USA ( with a sprinkling of the Maple Leaf)

• Josiah Neeley on how-to-avoid-defaultmageddon-randomize-obamacare
• Ricardian Ambivalence on yawning-pce-gaps-lead-to-low-inflation
• Menzie Chinn on policy_uncertainty_October1
• John Quiggin on the-ultimate-nightmare-american-default
• Mark Thoma on health-care-panic-again
• Mark Thoma gives us Tim Duy on fed-watch-on-communication 
• Barkley Rosser on public-health-externalities-argument-for-universal-health-coverage
• Menzie Chinn on estimated_macro-effects_of_the_shutdown
• Dave Altig on why-no-taper-one-mans-view
• John Robertson and Ellyn Terry on certain-about-uncertainty
• Ricardian Ambivalence on shutdown-crashes-us-confidence

Europe

• Brad De Long gives us wolfgang-munchau-do-not-kid-yourself-that-the-eurozone-is-recovering-noted
• Chris Dillow on help-to-work
• Simon Wren-Lewis on ken-rogoff-on-uk-austerity
• Jeremie Cohen-Setton on how-important-was-structural-balance-'screwup-in-driving-European-austerity

Asia

• Simon Wren-Lewis on japans-consumption-tax-test-of-modern-macro

Wonk

• Nick Rowe on if-banks-bought-houses, twin-debt-equilibria
• Edward Lambert on the-inflation-game-part-2-and-wonkish, is-there-a-natural-rate-of-inflation,is-low-inflation-bad
• David Glasner on hawtreys-good-and-bad-trade-part-iii-banking-and-interest-rates, hawtreys-good-and-bad-trade-part-iv-the-inherent-instability-of-credit
• Peter Dorman on modeling-policy-when-policy-is-inside-the-model
• Kruggers on the-gains-from-hyperglobalization-wonkish, phantom-crises-wonkish , the-virtues-of-adding-hoc-wonkis
• Josh Bivens on note-fiscal-policymakers-multipliers-large  Thanks Mark
• Mark Thoma gives us Arin Dube and  minimum-wages-and-job-growth-a-statistical-artifact really interesting
• Jim Devine on nber-recessions-vs-actual-recessions, nber-recessions-vs-actual-recessions_4

General

• Chris Dillow on are-jobs-a-cost, the-intelligence-curse, marxism-freedom-the-cold-war, mistaking-power-for-virtue
• John Quiggin on a-debate-resolved, the -productivity-zombie
• Michael Eisner on open-access-is-not-the-problem

Brian Banisch (Climate)

• commentary-on-ipcc-wg1-part-1
• Mark Thoma gives us world-leaders-must-act-faster-on-climate-change
• Peter Martin on cutting-emissions-hunts-has-twice-as-much-to-do
• John Quiggin on the-mail-on-sundays-own-goal-for-delusionism
• Harry Clarke on gloom-on-the-oceans 

Andrew Gelman (Statistics)

• the-difficulties-of-measuring-just-about-anything
• query-from-a-textbook-author-looking-for-stories-to-tell-to-undergrads-about-significance
• using-the-aggregate-of-the-outcome-variable-as-a-group-level-predictor-in-a-hierarchical-model
• ill-say-it-again
• a-comment-on-a-post-at-the-monkey-cage
• on-house-arrest-for-p-hacking
• scientific-communication-that-accords-you-the-basic-human-dignity-of-allowing-you-to-draw-your-own-conclusions
• lots-o-confusion
• ideas-that-spread-fast-and-slow
• Good Stats Bad Stats on income equality measures

Dave Giles ( Econometrics)

• solution-to-regression-trick
• more-on-distribution-of-r-squared
• can-economists-forecast-crashes
• in-what-sense-is-adjusted-r-squared
• the-true-title-of-bayess-essay
• peter-kennedy-on-getting-wrong-sign
• the-history-of-statistical-terms
• contemporary-econometrics-in-economic-education

Dianne Coyle & Frances Woolley ( Quirky with a dash of book review)

• Simon Wren-Lewis on tim-harfords-new-book-on-macroeconomics
• John Quiggin on how-to-argue-with-creationists 
• Dianne on top-economists-and-bob-dylan, walls-visible-and-invisible, the-enlightened-economist-prize-2013-winner
• Brad De Long on books-i-read-and-liked-in-the-second-half-of-september-2013
• Josiah Neeley on metaphysics-and-breaking-bad-finale
• Andrew Giles on give-me-a-ticket-for-an-aeroplane

Voxwonk

• where-unethical-corporate-culture-comes
• tax-evasion-and-incidence
• tax-policy-procyclicality
• independent-monetary-policies-synchronised-outcomes
• real-estate-driven-exports
• long-term-barriers-growth
• unconventional-monetary-policies-revisited-part-i
• unconventional-monetary-policies-revisited-part-ii
• return-migrants-economic-and-fertility-impacts
• ict-and-global-supply-chains
• great-recession-and-dutch-immigrant-unemployment

The budget

I'm a bit busy given it is school holidays but I will simply relate to the kouk's recent column on the budget.

He claims it is possibly the most contractionary budget we have seen since 1971. I agree.

Just a few things he did not mention.

Nominal GDP, is well below trend and hence the reason is the budget is not in the black. Thus there has been no cyclical boost to Revenue nor any reduction in outlays indeed it has been quite the opposite yet the deficit has fallen substantially. why is this?

It can be only because the structural part of the budget has been attacked. A contractionary budget when the terms of trade is falling means  only one thing.


Weak economic growth.

Wow If I called this budget expansionary I would be embarrassed. Now I forget just who did that?