Monday in “Hidden Variable” Land

We run into this problem in economics (and other sciences) all the time.

It’s called the Hidden Variable.

Historically, in physics, hidden variable theories were espoused by some physicists who argued that the state of a physical system, as formulated by quantum mechanics, does not give a complete description for the system; i.e., that quantum mechanics is ultimately incomplete, and that a complete theory would provide descriptive categories to account for all observable behavior and thus avoid any indeterminism. The existence of indeterminacy for some measurements is a characteristic of prevalent interpretations of quantum mechanics; moreover, bounds for indeterminacy can be expressed in a quantitative form by the Heisenberg uncertainty principle.

There are parallels in economics.  You’ll often hear phrases like “animal spirits” ruling the market – or that grab bag of excuses labeled “consumer sentiment.

Regrettably, after you run head-on into a few “hidden variables” you will quickly become suspicious of every news story you read.

The story circulating over the weekend that brings this to the fore is “It’s plausible Trump incited violence, federal judge rules in OK’ing lawsuit.”

I’m sure you saw videos during the campaign where Trump said “Go on…get ‘em out of here...” about the hecklers and protesters.

The hidden variable which none of the news reports I read bothered to mention was that US District Judge David Hale was appointed by Barack Obama.

If this were a science report it might be titled “Obama-appointed Judge Stretches to Bash Trump.”

But that’s just my odd way of seeing things.  Still, every one of the Trump defeats that I’ve seen have been issued by Obama-appointed judges and somehow that remains a mainly hidden variable.

You see this all the time – when you go looking.

The EU’s press to subjugate Ukraine was really about the huge Dnieper-Donets petroleum reserves of eastern Ukraine.

The fighting over Syria, is another.  Here, the Russians are bulking up their port operations at Tartus and they have good reason:  The Leviathan gas field lies partly in Lebanon’s territory

The Israelis, now beginning development in the area have waved-off other countries – including Lebanon.  The Israeli’s seem to get along with Sunnis OK, but Shi’ites?  Not so much – while Russia has it just the other way around.

Were it not for the U.S. advances in fracking technology, we would likely have been toe-to-toe with the Russians already.  But this benefits of fracking (if you don’t mind the ground water pollution and earthquakes) is another “hidden variable” that really drives the world.

Want more?

Well, how about those demonstrations by “students” in Hungary trying to keep George Soros’ university open?

Not hardly hidden at all is the Soros organizational ability to fund demonstration for La Raza, transgender rights, or whatever other ultra-liberal cause.  So the question Hungarians might ask as they read reports is “Who’s on the dime?” (getting paid…)

Made-Up Variables

Closely related are news stories from big outfits like CNN which toss in words like “nuclear” in headlines like “Senate faces nuclear showdown over Neil Gorsuch nomination.”

No, there is nothing “nuclear” about it.  A better term might have been “circus” but I’m sure somewhere there’s a headline writer’s Guide to Working People Up which says “…outlandish words gain readers or viewers…”

Which they do…

Hell’s bells:  Trump could appoint King Solomon to the high court and the left would filibuster.  It’s just never enough.

If you want REAL nuclear news, the NY Times piece “North Korea’s Nuclear Strength, Encapsulated in an Online Ad for Lithium” offers more headline/content agreement.

Trump’s Nepotism Problem

While we very much support the Trump presidency, the Jared Kushner AND Ivanka Trump being paid for with my tax dollars (and yours) undermines my confidence.

As the NY Times writes “Trump Couple, Now White House Employees, Can’t Escape Conflict Laws.”

10 weeks into a presidency is early to be making snap judgments but I’m pretty sure there are qualified people available for those positions.

Yes, it’s his call – his administration and all – but is this really the “best practices” kind of government we were expecting?

Time to End Political Parties

Peoplenomics topic Wednesday.

There are other ways to slice and dice America than with the crooked two-party system we have now.  We’ll table a couple of ideas.

The Week Ahead

Futures this morning are nearly flat.  But that Global Index event we pointed out to subscribers this weekend will bear watching this week.

The Nikkei and Hang Seng were both up overnight and this morning the European markets are mixed.

The Dollar was up a bit.  The way gearing works, this means it will take less paper to “buy the indices” so that may keep a lid on things.  And the stronger dollars (for now) will mean lower metals prices.

As the RoW (rest of world) begins to climb a bit, we may see some outflows from U.S. markets, but all things in time.

Tomorrow there’s a trade report, Wednesday and Thursday feature ADP and then Challenger job reports.  The Biggy will be Friday’s Employment Situation  report – the EmpSit.

A note from our bond guru:

“Remember when I told you if Russia/China would announce they are back their currencies with a basket of precious metals and reset the price in Shanghai to say something ridiculous like $100,000 to $150,000 an ounce and reset the silver ratio they could destroy us without firing a shot by just saying “show us your reserves?”

You can read the mechanics of how this is playing in the South China Morning Post article over here.

When you see U.S. gold prices pop $100 in a day or silver popping a buck in a day, then it may be imminent.

A Bush Gets Something Half-Right

Former Florida Governor Jeb Bush said Sunday that “people should be marching in the streets” to change an antiquated education system that isn’t preparing people for the robotics-based world to come.

Bush also referred to a Price-Waterhouse-Cooper report out last month that claims “Up to 30% of existing UK jobs could be impacted by automation by early 2030s, but this should be offset by job gains elsewhere in economy.”

As far as it went,, it was OK.

But Bush didn’t get into the real blood and guts of robotics:  The U.S. tax code that essentially (via excessive depreciation allowances) literally gives corporations free human replacements.  We’ve been covering that on the Peoplenomics side.

The good news is someone is talking about a core “going-forward” issue for a change.

A damn shame Jeb didn’t articulate more of this forward-thinking – rather than the reactive crap – that dominated the last election cycle.

America really need to stop voting by looking in the rearview mirror.

As a country, we’re an accident in the process of happening.

Comments

Monday in “Hidden Variable” Land — 17 Comments

  1. According to another website, we are paying a nice big fat pension to Obama’s mother-in-law. Why? She made a federal employee of some sort to take care of the girls.
    At least we arent paying for Ivanka’s salary (free) nor President Trump’s (1$)

  2. Why complain when, realistically, there is nothing you can do to change it. You yourself is the only person that counts (beside your neighbor, ha, ha ;-)).

  3. Hey George. Get back into investigative reporting mode. The latest sordid details are way, way too coincidental to ignore.

    The latest involves Erik Prince, the former CEO of Blackwater. He contributed $250,000 to Trumps campaign. Guess who his sister is? None other than Betsy DeVos. He also has close ties with Steve Bannon.

    The latest news has Prince being in a meeting arranged by the United Arabs Emirates, a high ranking Russian official with close ties to Putin. The meeting was an apparent effort to establish a back-channel line of communications between Moscow and then president elect Trump.

    First of all, where on earth is the swamp draining in this administration? The swamp is thicker and more infested than ever. Erik Prince donates $250,000 and his sister gets a major cabinet post? And, let’s not forget that DeVos herself donated tons of money. You have Exxon and Goldman Sachs executives also serving major posts?

    You all can say what you want about this Russian story, but there are just to many dots that are starting to connect and they are taking the shape of a very nasty scandal.

    And, of course we are paying Trump to enjoy 15 golf outings in 10 weeks. His trips to Mar-a-Lago are costing taxpayers $3 million a week. Total bill to date for his Florida trips are $27 million and climbing.

    And, Melania is costing the city of New York and America $145,000 a day. Now, add Ivanka and Jared Kushner to the list of Secret Service expenses and the Trumps are running up a bill that dwarfs past Presidents expenses. OK, he is not taking a salary, which only $400,000. That is a fraction of the cost he is racking up.

    Trump is playing America for a bunch of fools.

    • “And, of course we are paying Trump to enjoy 15 golf outings in 10 weeks. His trips to Mar-a-Lago are costing taxpayers $3 million a week. Total bill to date for his Florida trips are $27 million and climbing.”

      Interested to see the source of this info.

  4. Jeb Bush will never live down his “please clap” moment. What a putrid, entitled, excuse for a Human Being!

    • Even a broken clock is right twice a day – this was one for him

  5. How about Obama’s mother in law living in the White House for 8 years? Who paid for that? Plus I belive she tagged along on most of his International travels. Where are the photos of her in the White House or on Air Force One. What would the news fakers do if Tiffany moved into the White House!

  6. George,

    Same stuff again today. Are tax cuts really so so helpful, in your mind, that you always need to shade everything else Trump’s way? (Except net neutrality–your ox getting gored?) I swear that sometimes you act like a dad at his daughter’s first recital.

    We still love you, George, but really?

    Mike.

  7. How about the fact that taxpayers have to foot the bill for his sons to travel the world and make deals for Trump brand hotels. His family should be paying for that, not tax-paying Americans. He may have gambled by putting a lot of his own money up to fuel his campaign last year, but when he landed the electoral college victory, he hit the jack-pot. Now he gets to line his pockets more-so than any other president in American history. 180k to 300k+ per day for melania to stay in Trump tower in NYC. 15+ million in ten weeks for constant golf trips to Mar-a-lago. Sub-sidized travel for his sons deal-making trips world-wide. Must be nice to plunder so much money from tax-payers while wreaking havoc on their health care system, and eviscerating public programs that make up a miniscule fraction of the overall expenditures of our country. It will be a great day when he leaves office!

    • The one that gets be is the contrast between cutting Meals on Wheels and the Aspen Mar Largo outings. The only people who may not know anyone who gets Meals on Wheels or volunteers for Meals on Wheels may be the members of Team Trump.

  8. Trump hiring his daughter and son-in-law is a cowardice move on his part. They are his human shield. He knows his limitations and thinks that if his sweet and attractive daughter and her well healed husband are by his side, then it protects him from real nasty consequences of his compounding buffoonery. Sad.

    Plus, the real reason is that there is a shrinking cast of characters that he can trust. His narcissism has reached the paranoia stage, just like the Roman rulers; Tiberius, Caligula and Nero.

    • Jon is a democratic operative who is paid to comment on sites like this.

      • Ladies and gentlemen, greenacr is typical jobless Trump supporter that a spouts fact free nonsense. Case in point; his last post that says I am a democratic operative who gets paid. When you have that much time on your hands from being unemployed, you start to believe those espionage comic books you read are real.

  9. George: Ivanka is not taking a salary so no tax payer funds going to her. BTW: Pres. Trump is taking a $1/year salary. I’d like to see Presidential Pensions eliminated. All presidents are already worth millions and can and do make millions after leaving office. It’s a drop in the bucket but it’s a start. Perhaps I’ll put that on the White House Petitions site – along with a petition to eliminate the semi-annual tradition of changing clocks.

    On another note, Re: Peoplenomics, how about being consistent with chart colors. One chart has 2017 in red and the next chart it’s blue.

  10. Well George lets face it Trump is little different than Obama, (change you can believe in or making America great again) and Obama was little different than Bush, the powers that be coppered their bets with Trump vs Clinton, don’t like one vote for the other, and the wars go on, and that’s why a few million Americans said to hell with it and withdrew from the corrupt system of voting,as if your vote means anything anyway no matter who your voting for..

  11. “America really need to stop voting by looking in the rearview mirror.”…

    Isn’t that what the “again” means in MAGA.