Thursday, April 17, 2014

Connecticut's casinos

SealIndian tribes have a monopoly on running casinos in the State of Connecticut.

The following comes from memory: I'm way too lazy to look it up.

Anyway, the monopoly came about several years ago [;ate 1980s?], and almost accidentally. The state legislature passed a bill that was designed to give non-profit organizations the opportunity to use "Vegas nights" as a fund-raising ploy. The bill was universally understood as referring to transitory activities, not a permanent year-round activity.

But after that bill became law, a federal judge interpreted it -- apparently in conjunction with a federal statute -- as giving the tribes a right to open year-round casinos, so long as the casinos didn't include slot machines (the one game of chance that hadn't been included in the original state law).

The Mashantucket Pequots (whose tribal symbol is shown above) created their no-slots casino at once. It was Foxwoods, a reference to said tribal iconology: and a big hit: big enough a hit that the revenue of the state's own daily numbers operation was apparently suffering as Connecticut residents used their throw-it-away money elsewhere.  The state was soon faced with a choice: rework the law to close the loophole and close down the casinos, or rework it to cut itself in for some of the revenue.

The charities who were benefitting from their Vegas nights lobbied hard against any change that might hurt them.

The state went the other way. It used its one lever: the absence of slot machines in the Pequot casino. Connecticut promised to legalize slots, putting the Pequots into the gaming-world big time at a stroke, IF the state got a percentage of the slots revenue. The percentage eased the state's pain about the loss of money on the daily numbers.

Anyway, the Pequots and since then another tribe as well, have enjoyed their slot machine and casino privileges. I recall getting into some fun exchanges in the letters section of local newspapers back when all this was novel and controversial. I would defend them against idiots who would decry the awfulness of gambling and suggest the rest of the state should boycott them.

I'm not going anywhere with this: I just enjoy a trip down memory lane now and then.


Sunday, April 13, 2014

Link Farming on High-Frequency Trading


My erudite readers are surely aware by now that Michael Lewis has a new book out, Flash Boys: A Wall Street Revolt. It concerns high-frequency trading (HFT), especially as used as part of a process of scalping, or lawful front-running.

Here's the amazon page.

CNBC has on Lewis, and Brad Katsuyama, a man flatteringly profiled in his book, as well as one of the bad guys in the book's story, William O'Brien of BATS. They looked like they were about to start punching each other now and then. If you haven't seen it: here it is.

Felix Salmon has reviewed the book for Slate, here.

But Salmon was writing about the book before he wrote that piece, even (by his own admission) before he had finished it. Salmon, and many other people at that stage of the brouhaha, were reacting as much or more to the 60 Minutes roll-out of the book as to the book itself.

For the informed reactions of Ginger Szala, a veteran financial markets reporter, go here.

And for my own reaction: here.

Of course, this was an issue in some quarters well before Lewis decided to infuse it with his own brand. Arnuk and Saluzzi highlighted some of the issues two years ago. And I reviewed them at the time.

The photo of Brad Katsuyama I've inserted above was used to illustrate a Wall Street Journal story about HFT and the utility of BK's trading platform as an "antidote" back in July of last year.

And one of the commenters on the amazon-com page for the Lewis helpfully refers us to another one: The Lights in the Tunnel.

You'll surely be hearing and reading more about HFT.

Saturday, April 12, 2014

The New "Cosmos"

File:Carl Sagan Planetary Society.JPGNeil DeGrasse Tyson is the astronomer who is now explaining the "Cosmos" to the lay audience in the revived television series of that name.

Ah, the fond memories that name brings back. Of the original Carl Sagan series, I mean of course, which in 1980 became the most widely watched television series in the history of US public television.

Sagan's Cosmos also coincided with something called Battle of the Network Stars, the sort of thing that today would be called "reality programming." It was a series of sporting or pseudo-sporting events involving established personalities. In the 1980 season, the ABC team included Scott Baio, CBS's team included Gregory Harrison, and NBC's, Pamela Helmsley. If those don't sound like top tier stars to you: the feeling is natural. These were TV personalities who could use the additional exposure that the silly games would get them.

All of this is simply an excuse to go a little further down memory lane and recall a brilliant SCTIV spoof on Battle, called Battle of the PBS Stars. One of the teams was captained by William F. Buckley (Firing Line was still on the air in those days) and the other was captained by, you guessed it, Carl Sagan.

Series regular Dave Thomas played Sagan, with special emphasis on the pronunciation of the letter "b" as in "billion."

At one point there is a football game between the two teams, and Buckley's team nrings in some heavy-hitting ringers. They run head-on into Sagan, and then you see a doll presumably filled with helium and representing Sagan floating up into the sky.

I believe it was Eugene Levy who, as host Howard Cosell, delivered the punchline as 'Sagan' disappeared from sight. He told us we shouldn't be sad about Sagan's loss, because now "he's up in the cosmos, where he always wanted to be."

I'm working from memory here, because I'm too lazy to look these things up, so that account may not be entirely accurate. Still ... Neil Tyson is treading on sacred ground. Best of luck to him.

Friday, April 11, 2014

Shakespeare's Montaigne

Stephen Greenblatt is the general editor of The Norton Shakespeare and author of the book Will in the World: How Shakespeare Became Shakespeare. The April issue of Harper's includes a review of a book by Stephen Greenblatt and Peter Platt, Shakespeare's Montaigne.

Joshua Cohen, writing the review, calls it "a crash course in Elizabethan lit, a multi-culti study of the development of English and, above all, a revisionist biography of a monumental dramatist who not only cribbed the classical education he lacked but also responded to his sources with a fierce and censorious intelligence."

So the working hypothesis of the study is that Shakespeare got his classical education second-hand, largely by reading Montaigne, and that he was at the same time willing to bite the hand that fed him some good material.

For example, in his essay "Of the Cannibals," Montaigne sentimentalizes the just discovered people of the Americas, seeing them as peaceful anarchists. He writes that they:

hath no kind of traffic, no knowledge of letters, no intelligence of numbers, no name of magistrate, nor of politic superiority; no use of service, of riches, or of poverty; no contacts, no successions, no dividences, no occupation, but idle; no respect of kindred, but common; no apparel, but natural; no manuring of lands, no use of wine, corn, or metal. The very words that import lying, falsehood, treason, dissimulations, covetousness, envy, detraction, and pardon, were never heard of amongst them.

That quotation is taken from a translation of Montaigne by a contemporary of Shakespeare's, John Florio.

In The Tempest, Gonzalo fantasizes of a similar world, in quite similar language.

I'th' commonwealth I would by contraries
Execute all things; for no kind of traffic
Would I admit; no name of magistrate;
Letters should not be known; riches, poverty,
And use of service, none; contract, succession,
Bourn, bound of land, tilth, vineyard, none;
No use of metal, coin, or wine, or oil;
No occupation; all men idle, all;
And women, too, but innocent and pure;
No sovereignty...."

It seems as if Shakespeare must have had Florio/Montaigne's book open to the relevant page when he wrote Gonzalo's speech.

Cohen contends though that this was as much commentary as influence. In Montaigne, the passage is in earnest, in Shakespeare, it is a bit of a game, poking fun at Gonzalo's naiveté -- and presumably Montaigne's as well.

Fascinating point, Mr. Cohen.

I do think that Greenblatt, who seems to have been the senior of the two authors in the book under review, is the real deal in Shakespeare scholarship. I've long had difficulties with the excessive efflorescence of Harold Bloom on the subject of the bard. Thus, it is Greenblatt's photo I have included above.

Thursday, April 10, 2014

Farage/Clegg Debate

In our Mother Country, Nigel Farage has been debating Nick Clegg of late.

The most recent, the one that has me paying attention now, was the one on Wednesday, April 2, 2014.

For my fellow Americans, who only rarely tune into matters on the other sides of oceans -- it is worth your while paying attention to this.

Talking myself through it now ... Farange (that's his picture above)  is the leader of the UKIP, or the Independence Party, which wants to quit the EU altogether and reduce immigration. Clegg is head of the Liberal Democratic party, which is in coalition with the (larger) Conservative Party in the present government. Clegg also has the title Deputy Prime Minister.

The aforesaid CP hasn't been taking part in these exchanges. Neither has the other Major Party, Labour. Its a little bit as if, in 1912, Theodore Roosevelt had debated Eugene Debs, leaving both the incumbent president (Taft) and the major party challenger (Wilson) out of the exchange. well ... not much like that. How much like a rooster is Gonzo?

Anyway, Clegg (that's his picture below) supports UK participation in the EU.

On April 2d, the two candidates engaged in what pundits always call a "spirited exchange." Farage said that his program is very popular among Brits, but the obstacle, represented by Clegg, is the "career political class, and their friends in big business."

Clegg responded that this is a "dangerous con" because the world has changed since 40 years ago when the UK entered the EU. It has changed by becoming more interdependent. "Working together with others is not a bad thing, it actually strengthens us, it doesn't weaken us."

The question of Russia and its recent takeover of the Crimea arose at about 8:45 in. A member of the audience asked how it is possible for Britain to "face up to international challenges like Russia in Crimea without the political weight which comes from being part of the European Union."

This gave Farage the chance to accuse the EU of having an "expansionist foreign policy." He alluded to a Baroness who is "pushing for a European air force." The EU, with at least the implicit promise of NATO support, has given encouragement to the Ukrainians, and that encouragement has worsened the clashes there.
"We have given false hope to those western Ukrainians," he said. So his answer to the question, though not quite spelled out this way, was that Britain should not want the kind of political weight that comes from being part of the EU, and should not help give the EU such weight by its participation.

Clegg rose to the bait. "It is extraordinary that his [Farage's] loathing of the EU is so all-consuming that he is now seeking to justify and defend" Putin's actions. This gives Clegg an open door into the subject of Syria, where again he blames the violence on Putin. Presumably, the point (again left unsaid) is that the EU/UK combination could do more against Assad than either of the two components separately can or would do.

At 12:36 they are talking over each other and its a bit entertaining, but soon enough they control themselves, stiffen their upper lips as their Victorian ancestors would have said, and they carry on.

I won't continue with a blow by blow, but I found it all quite illuminating and would like to commend the Brits for the kind of politics that can still entertain an intelligent and vigorous discussion of such issues. Our own political culture ... not so much.

Sunday, April 6, 2014

Access to Real Values

Last week I quoted from a 1975 book by Adam Fergusson, WHEN MONEY DIES, about the Weimar era hyperinflation.

One point the book makes that was new to me was that the Germans weren't the only ones hit. All three of the defeated powers (I say 3 because of course after the war Austria and Hungary were separate countries, no longer connected by Emperor or hyphen) were subjected to the ruinous war reparations demands of the victorious allies, and all three countries gave in to the temptation to gun up the printing presses.

As to the consequences, I found this passage of great interest: Only the country people were surviving in Germany [in autumn 1922] in any comfort: anyone who lived off the land had the readiest access to real values. It was not surprising that even when they ensured that the money receipts for their goods were no more than equivalent in purchasing power than what they were used to, they were accused of extortion-- the more so if they delayed the sales of produce in the full knowledge that prices would be higher the longer they waited.

Saturday, April 5, 2014

Dilbert and Cold Fusion II


Continuing yesterday's thoughts.

Back in 1989, two chemists claimed to have created a simple table top apparatus that would work at room temperatures and that would create excess energy in amounts that, the chemists contended, had no explanation other than the incredible one: atoms were fusing.

The scientists were: Stanley Pons and Martin Fleischmann. They were both sufficiently distinguished that the claim could not be dismissed lightly. Pons had a Ph.D. from the University of Southampton; Fleischmann from the Imperial College, London. That's Fleischmann in the photo that goes with this text, holding part of the apparatus, which was a little more complicated than Dogbert's.

Their claims set off a frenzy of speculation about what this would mean. Some thought it would be bad news -- that the human race could not be trusted with the prospect of unlimited energy this implied. The more usual view was that this was great good news -- an apparently insatiable hunger would at last final satiation. There would be no more wars for hydrocarbon supplies. And so forth.

 Alas! (or Hurrah! if you prefer), it all turned out to be a fantasy.

That of course was the catalyst for the pair of Dilbert strips I quoted yesterday.

I bring it up because we're still looking for that satiation, though the search has passed on. I engaged in an exchange on a certain internet message board not long ago with a woman who was certain that various breakthroughs would soon make energy "too cheap to meter" [a phrase that goes back to the '50s and the days of the testing of very hot fusion] -- her twist on this was that she thought it would be a great socialist advance to have energy too cheap to meter. It would mean that the capitalists had at last cut their own throats, and that the world was ready to move on beyond scarcity economics.

Hurrah! (or Alas! if you  prefer), that too is a fantasy whatever the specifics of the scientific advance. There is a difference of literally infinite significance between any cost for energy, any positive number reflecting that cost, on the one hand, and literally zero cost on the other. If we discard zero cost as a fantasy, then the idea is to get to a very small number. Too cheap to meter, though not quite free.

How would that come about? Isn't the measurement of costs simply another way of expending energy? It seems to me that any breakthrough that makes the costs significant lower also will enable more discriminating meters, so you're just chasing your tail on this "too cheap to meter" stuff.

Congrats, then, to Scott Adams for nailing the point in his own way.