Logs & Writing
This is a collection of my short and longer writings, lifestyle notes and blog, vlog, favorites, quotes, and other publications: the flow of present moments, now, current happenings and activities, mental states, immersion, focus, involvements, moods, feelings, and states of mind.
I was watching this course of lectures on human behavioral biology by Robert Sapolsky, a professor of Stanford University, to learn more about human beings, because I realize I really need to understand them/us better after resent tragic events in my life (a betrayal of a very close friend). I combined the experience with reading Dostoevsky, Camus and Gide, but it is another story.
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- Author: Lena Nechet
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Financial bubbles are a relative newcomer to the motley collection of Ponzis. The recognition of their status as Ponzis came about because it became clear that the psychology of an investor is the same, whether or not money is going to a realtor, a stockbroker or a fast-talking conartist. In all cases, it is the sustained rise in prices—or, more precisely, the expectations of an up swing—that keeps the process going. This is what led economics Nobel laureate Robert J. Shiller of Yale University to call it a “naturally occurring Ponzi”—that is, a bubble that forms not in response to a manipulator’s baton but to natural market forces, with one person’s expectations stoking the next person’s.
We have seen this happen in the housing market and, through the ages, in the markets for gold, whereby you want to buy a good only because others have the same motivation, and so the prices will rise.
Many forms of legitimate business activity can also camouflage a Ponzi. Consider the widespread and perfectly legal practice of giving stock options to employees. It can generate profits even though the company’s practices may create low-cost products of trifling value.
An iconic example would be a Silicon Valley start-up that hires highly skilled graduates by offering a starting package with low wages, below the prevailing market rate, while adding in stock options that carry the promise of large future returns. The paltry wages guarantee that the company can still make a profit
even if it charges customers cut-rate prices for its products. The owner, meanwhile, keeps a part of the difference between the low-cost goods and the even more menial wages while giving away the rest as supplementary earnings to senior employees.
As the firm grows by employing more workers, the entrepreneur can earn a very high profit, even though, like all Ponzis, this one will eventually crash and leave the employees without jobs or in possession of worthless options.
The rationale for TBTF (“too big to fail”) hinges on the belief that if a big investment company goes bust, the collateral damage for ordinary citizens will be so large that the government needs to save the company. It has now become evident, however, that a well-meaning TBTF policy—or, for that matter, one that is ill meaning but well disguised—can exacerbate a crisis by assuring financial honchos that if they make a profit, it will be theirs to keep, and if they experience a loss, it will be for taxpayers to bear.
Scientifi c American, June 2014
usaponzi.com/files/ 89610065.pdf
Kaushik Basu is senior vice president and chief economist of the World Bank and a professor of economics at Cornell University.
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- Author: Lena Nechet
- ▲ Logs & Writing
- ▼ Essays & Notes
Poems × 9
My own verse.
Verse is a metrical writing.
Poem
- a verbal composition, in which the words are chosen for their sound
and for ideas and images they suggest, and are arranged in separate
lines, often ending in rhyme.
Poetry is a form of literature that uses aesthetic and
rhythmic qualities of language. This form of art is thousands years old,
and originated in Africa.
Essays & Notes × 62
My short and longer texts, from notes to formal essays, with lists, facts, and opinions.
Essays - short literary compositions, presenting ideas in a non-fictional way.
Notes - brief records, especially written down to aid the memory; comments, explanations.
Blog × 52
This is my weblog and personal journal: notable days and my lifestyle from running and swimming to frugan food, plus occasional informal reports and random anecdotes.
Journal - periodically and randomly published records of personal experiences and observations.
Anecdotes - brief accounts of an incident,
stories with a point to communicate an abstract idea about a person,
place, or thing through the concrete details of a short narrative.
Vlog × 33
My random video logs - videos from daily life and something notable to remember.