Monday, June 27, 2016


[Just up on my Google+ Collection, Social and Political Reflections...]

Political and financial predictions are notoriously – and necessarily – unreliable, but we often have to make them and act on them. This is especially so for those who depend on investments for a large part – or all – of their income.

Predictions about the direction of stock market indices, property prices, interest rates, etc. are much harder to get right than predictions about the outcomes of elections or referenda. The former (like typical referenda and many elections) may involve a simple binary choice but – unlike elections and referenda – they are not tied to a timetable. So bubbles and other market distortions can persist for long periods of time. Timing is crucial for investment, but the best one can hope for in this regard is to get one's timing approximately right. [1]

Political risk is one of the things that makes financial predictions so problematic – and we are seeing a lot of it about these days.

Politics, one might say, is an unfortunate necessity. [2] Really, it's just about – or should be about – the boring business of organizing an institutional and legislative framework which allows large numbers of people to live together in a reasonably cooperative way. But it's also a very human thing, being utterly dependent on basic human attitudes, especially trust: trust in one another, and trust in the powers that be.

Recent events have amply demonstrated that both the US establishment and the EU establishment have lost the trust of (a majority of) the people. Add to that social divisions – the result of economic hardship and cultural changes (arguably compounded in some jurisdictions by large-scale immigration) – and you have a recipe for trouble. [3]


[1] I have been expecting a bear market in stocks for more than two years now. It may finally be upon us. But I have been dead wrong about Treasury bills and bonds, etc. (yields just keep dropping!). I know there is supposed to be an inverse relationship between stock and bond prices but (like many others) I see a bubble in both.

[2] The phrase is in my mind because a short commentary of mine on a fascinating episode of an old Canadian television panel discussion series is about to appear at The Electric Agora. The main question the panel addressed was: Is spying an unfortunate necessity?

[3] I know the immigration issue is a sensitive one, and there is a lot of xenophobia about, but it is wrong to accuse everyone who questions the wisdom of large-scale immigration of bigotry or racism. This is part of the problem, in fact. Many years ago Enoch Powell was forced out of British politics when he argued strongly against his country's immigration policies. The subject was taboo and it still is in certain circles. Why can't we just talk sensibly about these things?

Saturday, June 11, 2016

The US presidential contest; Brexit

[This is the latest post in my Google+ Collection, Social and Political Reflections.]

A couple of things I am following at the moment are the US presidential election process, and the UK referendum on membership of the EU.

I see Hillary Clinton as morally compromised and dangerous both to America and the world. I tend to agree with something Marc Faber said some months ago: Trump may destroy America, but Clinton will destroy the world. Actually, I think you could say America is already well past the point of no return. I am thinking of debt (especially sovereign debt but also consumer debt), the precariousness of the dollar, and demographic and cultural changes. Certainly the old Protestant values of thrift, hard work and self-reliance on which the country was built are rapidly disappearing.

My analysis of Donald Trump is very much in line with Scott Adams' analysis: Trump is a master communicator and he will probably win the presidential election.

I'm am also watching the UK referendum closely. When Boris Johnson first announced his decision to support the Leave campaign, I thought it would be enough to swing it. As I said then, it has been clear for a long time (if not from the very beginning) that the EU was all about a federal Europe. People were deliberately misled on this, but now there is no excuse: anyone with half a brain knows that continuing membership would entail a progressive loss of national sovereignty. Some, wary of nationalism, think this is a good thing. But I would say nationalism can be a positive force, and that it has a role to play in maintaining social cohesion within (if not between) the countries of Europe. God knows, most of the other cultural (especially religious) traditions which tied people together in benign and productive ways are dead or fading fast.

To my mind NATO (and American interventionism generally) is a far greater danger to peace than patriotic feelings.

Thursday, June 9, 2016

The tiger in the window

I have now begun a third Collection on Google Plus, called Language, Logic, Life.* No more are planned.

The new site has a similar name to my other blog but is not intended to replace it. 'Language, Life and Logic' is a play on the title of A.J. Ayer's account of the philosophy of the Vienna Circle and the blog has a more or less philosophical focus. The title of the new site lacks this oblique reference to Ayer, and logic is deemphasized slightly, with 'life' getting the more significant final slot. In other words, the new Collection is intended to be slightly more open than LL&L and will include lighter material as well as more serious stuff.

My latest post there illustrates the lighter side: just a snap and few words of commentary. As follows...

A striking Herm̬s window display (Collins Street, Melbourne)... I had thought that 'paper tiger' was a long-established English expression, but it seems that its use in English (and French as 'tigre de papier') only dates from relatively recent times Рprompted mainly by its use in speeches by the Chinese revolutionary leader Mao Zedong. It is a phrase which has very deep roots in traditional Chinese culture.