Wednesday, January 30, 2008

Secrets and Lies: Robot Sheep Don't Have No Money

Here's a story for you. A herd of robot sheep saw the Sun going down on an otherwise dull day. A few of the sheep, having not seen the Sun go down (because robot-sheep days are long and robot-sheep memories are short) were afraid and ran in the opposite direction fearing a Nuclear Blast. The other robot sheep were a little confused by this, but having very bad memories, thought it safer to follow the sheep who were, supposedly "cautiously", making their unnecessary escape. And so it came to pass that the Sun could no longer shine on the happy robot sheep, and almost killed itself in a fit of Sunset-brilliant despair and bewilderment.

Fortunately, the Moon looked on, and saw it all from afar, from high above. From there, he decided the best thing to do was not to explain to the sheep anything about how the Sun works, but rather to construct a Fake Sun, and embellish the still-brightening sky with it. This way, the sheep would never need even know that the Sun really set, and could spend their days in blissful ignorance, eating grass and telling stories about iPods. (Or their day, at least - there were no days or nights any more. Until the Fake Sun exploded.)

The moral of the story is nothing. The moral of the story is that ignorance is everywhere and nowhere. The moral of the story is to never look directly at the Sun. Choose your own moral.

In the meantime, and completely unrelated, it's good to see Alistair Darling wants to avoid bank runs by handling emergencies in secret.

Thursday, January 24, 2008

Up a Panic Gear: "Get Out Now"

The rock is picking up speed... Moving firmly away from FT territory, economy musings get picked up by the local rag today. The headline in the Real World reads "GET OUT NOW". The text goes like this:
Experts are warning homeowners to get out of the property market before a massive crash wipes more than £100 million off the value of Sussex homes.
The record-number of comments include a fair mix of "scaremongering!" vs "ha-ha" and "good", but that's not the point here. The point is that the bursting of the bubble is reaching down, out of the FTSE sky, and into the lives of "real" people like a Monty Python foot.

Don't forget: This bubble came about not from managers over-spending, but from people at the bottom of the pyramid* not being able to pay money back. There are plenty of people down there who aren't quite in the same position, but aren't FT readers. Panic depends on an information gap. That gap's now being filled with fear. And when people are scared, people hang on to cash. (On the bright side, inflation should fall of its own accord...)

* Pyramid, yes, even though the argument goes cyclically: "consumption -> demand -> supply -> production -> jobs!". It's a "pyramid-cycle" because money comes out of the system at each level. There is no such thing as Perpetual Motion.

Tuesday, January 22, 2008

Split-Personality Institutions

Universities are facing a tough time. Are they for extending knowledge? Or for training people up so that they can get jobs in an "advanced" economy? The former harks back to the original definition of "academic", while the latter juggles with the idea of "practicality". But there are compromises to be made, especially when a sense of economic efficiency watches over the two of them. Computer "Science" is no exception, as has been seen/highlighted in recent discussion over the suitability of teaching Java to students.

But I think this tug-of-war goes a lot further than education. The Ideal Government blog has a snippet concerning the IPS's indecision over what the National Identity Register should, in fact, be.

This "split-personality" for such services is interesting. Does it come from an agglomeration of functions? (Evolution = economy of scope in an increasingly genericised world?) How about a re-definition of the role a particular institution now finds itself in? (Research now becomes more practical than academic, as progress becomes more and more important?)

Or are we reaching a "critical mass", a tearing between scales? Is the system more important than the user? Can a user exist without the system? And what, after all this, is the correct course of action?

Thursday, January 17, 2008

The Hamster Wheel(s) of Capitalism

Is there a difference between "selfish" and "unselfish" capitalism? Is materialism making us Crazy In The Head? This BBC article looks at Oliver James' new book, "The Selfish Capitalist: Origins of Affluenza.

Whether the book is any good and/or useful or not is a question I'm not going to go into, but it's good to see the argument being raised. (And depressing, at the same time, that it's not thought of as Obvious Knowledge.) But there are some interesting points made in the article. The main point, namely, that we have a form of capitalism in the UK which is different that to on the continent, and which brings us more mental illness, such as depression.

There are three threads to this, which are somewhat picked out in the article...

1. Capitalism and the Individual: That is, Capitalism taps into an "inherent" desire by the individual - a desire for "Stuff". Stuff helps us do things, helps us to live, distracts us from other things. For instance, I like my teddy bear - it gives me emotional satisfaction even if "rationally" it is nothing but Stuffed Stuff. This is the individualistic level of capitalism, and is possibly why "retail therapy" is addictive, in the same way that drugs and drink are addictive. ("Some people say alcohol is a drug. It's not, it's a drink.")

2. Capitalism as an Indicator of Position: Power can be compared to a tree falling in the forest. An individual cannot have power in isolation - there must be a subject that this power extends over.

This picks apart the argument between capitalism as a "non-zero-sum" game - in which individuals are better off, even if others have more - and as a "zero-sum" game - in which people effectively have less when others have more, even if their own value has stayed the same. (For a lot more discussion on this, see here.) Retail Therapy and the individualism in point 1 can be considered an effect of a non-zero-sum game. But Power artefacts can be considered a zero-sum game effect. For me, the existence of inflation is a simple pointer to the latter as being more significant though: the more money someone else has, the less mine is worth. We are tied together through the value of our cash, and so it is not enough to simply have "more money". The crux of the matter is that it's important to have "more money than others".

And this is why money is power, is status. And why consumption, and Stuff, is important - because Stuff is a signal for how much money, and hence how much "power" we have over others. For example, if I can afford to buy expensive brand clothing, I can afford to eat more, and live longer.

The conssequences of this are explored below, in point 3. For now, just consider what this means for rising inequality in Britain.

3. Capitalism as a Norm: This is actually a combination, an "evolution" if you like, of themes 1 and 2. The article picks this up quite well. As Simon Wessely says:
"more human experiences" are seen as illnesses nowadays. In my trade, for example, states of sadness are now seen as 'depression', shyness has become 'social phobia', and all sorts of variations in childhood temperament, personality, emotions and behaviour have become characterised as diseases that need treatment
Indeed, maybe this is the bond that ties together the first 2 points - a re-definition of "normality" through a subtle yet significant - ubiquitous - usurping of Old values with New Ones. New Ones that posit twin snakes of "happiness" and "equality" as their foundation. If Capitalism had a motto, it would be "All Can Smile."

But it's this idealist posturing that forces us into a vicious circle. The trap is this: by placing utopia within "reachable grasp", it leaves us in a modern state of distopia at all other times. Throw in the idea of "progress" - technical mainly (moral progress is generally left alone for its sin of being unmeasurable) - and this distopia extends to a dark and continuous eternity. To state this distopia in 2 simple sentences:

1. If you have less Stuff than any other One Person, then you are unhappy.
2. Technological progress creates new Stuff.

Thus, not content with trying to keep up with the single Hamster Wheel of Inequality, we force ourselves to straddle another Wheel, that of progress. If one doesn't get you, the other surely will.

Enough of this for now. Hopefully the next post will look at the effects of networked capitalism on the subject.

Wednesday, January 16, 2008

The Switch to "Viral Economies" (+ tidbits)

(I've got into the habit of posting economy posts like this to my other blog, but thought I'd bring this one over here for various reasons. Mainly because it brings up the psychological side of economics.)

The FT's front page is looking fairly severe today, touting heavier-than-normal phrases such as "plummet"ing, "tumble"-ing and "hammer"ing. Ill omens have been sweeping from the south-west across the front page with various aplomb over the past 12 months, but perhaps the latest battering brings with it more than just a lot of rain. Meanwhile, American consumers are "turning cautious at the very least". It really does seem to be something of a pincer movement by the forces of Balance and Correction.

What's really interesting, from a systemic point of view, is whether - or when - the fears of a housing market collapse will move from a "rational" process, to a "viral" one, in the same way that Northern Rock only really "took off" (in the wrong direction) once it hit the headlines. Or in the way that OPEC hoped to avoid killing the dollar itself.

Monitoring the FT is one thing. The people that read it have a good handle on what's happening already, so surprises are few and "damage" - panic? - is relatively limited. Information is an ally, and so the really interesting stuff only comes once other newspapers, the non-economists, start talking about what's happening, and How It Will Affect You.

Of course, that's where this may differ from the Northern Crock: How-It-Will-Affect-Me is different to How-I-Can-Affect-It. Pulling money out of a bank is a definite choice, like pulling bricks out from under your feet. But an economic squeeze is, one could say, more "deterministic". Sure, one can choose to spend, or not to spend, but it's a lot more likely that how much you spend is directly proportional to how much you're expecting to receive in future. In other words, the current situation is less about losing your cash (as per the Rock), and more about rationing it.

Which, of course, is why people are starting to sell their houses now, rather than later, and why they're not buying quite so much crap. Scarcity begets scarcity. On the plus side, that pound in your pocket should be worth more...

So it hasn't escaped my attention that Richard has been bookmarking panic a lot recently. Sensible forethought. Relying on information - reading the FT - is one thing. But a purely "rational" approach, based on economics, tells you nothing about what happens when economics and hysteria combine: Facebook Banking? About when news spreads like a virus feeding on a monoculture of fear and risk-aversion.

The question is "when", not "whether". And How-Will-It-Affect-YOU?

Meanwhile, some linky tidbits...

Brian Haw violently assaulted then arrested along with other peace protestors. Sousveillance disrupted, although I haven't seen the film put together about it yet - scroll down for links, and for updates to the situation. (See also BBC Coverage.)

"Server in the Sky" programme to share biometrics internationally, in case you missed it.

Sunday, January 06, 2008

We were never at War with Eurasia

Britain Drops 'War on Terror' Label
Sir Ken Macdonald said terrorist fanatics were not soldiers fighting a war but simply members of an aimless "death cult."
So are we safer now? Why was it declared as a "war" in the first place? What rhetoric takes its place?

(Via James and Schneier.)