Sunday, December 28, 2008

A Few Motivational Quotes...

Control what you can control

One must move step by step and keep moving - Atlas Shrugged, Ayn Rand

Take pride in all that you do

Value the process of hard work rather than the rewards it brings

You reap what you sow

Sunday, December 21, 2008

The Impressionable Elites Get Snookered

Mark Penn of the Wall Street Journal has a great article with some interesting facts concerning the economic crises and the growth in wealth over the past decade. Click here to see the article or read below.

The Impressionable Elites Get Snookered
MICROTRENDS
DECEMBER 19, 2008, 11:42 A.M. ET
By MARK PENN

For most of this century, con men and hucksters preyed on the uneducated and the elderly who couldn't read the fine print. Some still are.

But now we learn that the real mother lode for con artists is not composed of uninformed dowagers who were left an estate they don't know how to manage, but rather the Impressionable Elites* of country clubs, and the rarefied hedge fund managers of Wall Street and Greenwich.

Forget about huge, sweeping megaforces. The biggest trends today are micro: small, under-the-radar patterns of behavior which take on real power when propelled by modern communications and an increasingly independent-minded population. In the U.S., one percent of the nation, or three million people, can create new markets for a business, spark a social movement, or produce political change. This column is about identifying these important new niches, and acting on that knowledge.

In "Microtrends: The Small Forces Behind Tomorrow's Big Changes," I take the view that rational, informed behavior is spreading through the better-educated lower and middle classes -- those who went to college, have information-economy jobs, and use the Internet. But at the same time, the elites have become more impressionable -- more removed from everyday problems, more trusting of what they hear, and more likely to adopt unthinking viewpoints based on brand or emotion.

Bernard Madoff proves the point. Here he is, in the most numbers-dominated part of our economy, and no one questioned his numbers. He sold himself to people on the basis of brand, and he got access to more marks by using the smart, rich and famous to introduce him to more of the smart, rich and famous.

Historically, elites have behaved like this. They follow a path from being the founders of new nations to the dupes who stand by as their piece of civilization is sacked and pillaged. It's like the old cliché about Nero fiddling while Rome burns. We are not quite where Rome wound up, but we're exhibiting some of its tendencies.

What happened in America before the financial crisis is that we had the fastest expansion of the elite population in history. In 1996, the top 1% of voters and consumers made $200,000 a year or more. Now, in the last election, 6% of the voters made over $200,000 a year -- a surprising sixfold increase in what used to be called the top 1%.

But our research** shows that the top 1% is heavily swayed by gut and impression, not numbers and facts. They vote more on the basis of personality in campaigns; buy products more on the basis of brands; and invest more on the basis of the tip than on sound logic. Who else would pay a premium for jungle-ready vehicles to run the rugged terrains of Scarsdale and Georgetown? Or shop at doggy bakeries for their pampered pooches?

How else could you explain Mr. Madoff allegedly making off with $50 billion dollars of elite money in the largest Ponzi scheme in history? Or Marc Dreier, the lawyer accused of selling $380 million of non-existent promissory notes to major investors?

At a recent meeting of my condo, the residents were asked if they had read all those documents they signed when they bought their apartments. One hand went up. Most of the residents hadn't even asked their lawyers check them out.

Elites are on information- and time-management overload, and the result is that they have been making big decisions with less information, not more. They throw their hands up in the face of adversity and complexity, relying upon the judgment of others instead of forming their own.

The entire financial crisis was started by small microtrends overlooked by some of the best and brightest minds at institution after institution. The crisis started with a default rate of something like 17% on subprimes, which were only about 10% of the marketplace -- or a total of about 1.7% of all mortgages. This tiny but growing group of borrowers -- a microtrend -- had enormous consequences for unwinding trillions of dollars of leverage and freezing the entire credit system. It happened because the best and brightest minds simply ignored those forces as too small to matter, too improbable to become important. But they did.

So now these same elites, and the millions who trusted them, are going to have to look at the numbers again. They can't just put their money in mysterious hedge funds and bigger houses and wait for manna to drop from the sky. They are going to have to start balancing their checkbooks, managing their healthcare costs and setting a monthly budget that they actually meet. Looking at greatly diminished assets and futures, these elites might just be shocked into reading the fine print on what they buy, or demanding detailed statements every month that they open and read.

And real transparency just might sell again to elites who used to love to invest in the black box. All Madoff and Dreier did was prey on the basic fact that elites don't really ask questions of other elites, and don't really demand answers when they do. Maybe that will change.

Maybe people will start ordering up mini SOX audits of their own finances, catching those repeating credit card subscriptions that go on their credit cards for things they have not used in years; demanding that each and every fund they invest in meet strict new criteria. They might even ask elite colleges to justify $50,000 a year in tuition for little personalized instruction.

The Dreier and Madoff scandals show just how impressionable even the smartest, best educated elites have become. But the reaction to their own unwinding, and to the reality of the financial crisis, just might bring them back to earth.

* "Impressionable Elites" is the term we used for educated, affluent people who focus more on personality than issues when it comes to evaluating political decisions. For more, please see pages 131 to 135 in "Microtrends."

Write to the Online Journal's editors at newseditors@wsj.com

Quote of the Day

"In the midst of winter, I finally learned that there was in me an invincible summer."
-Albert Camus

Sunday, August 17, 2008

Chilling Costs of Global Warming (from WSJ)

Let me preface this with a brief synopsis of my opinions on global warming as they stand today. Generally, I believe that global warming is a natural effect of the world as was the ice age and all previous geological phases of Earth. Having said that, the human condition could have an impact on the speed or depth of global warming, and I am a firm believer in curtailing our possible effect on it (less electricity, less a/c and heat, less traveling, less fossil fuels, less water...more efforts to protect the ozone as we understand it today, more renewable energy sources, more recycling, more local produce, etc.). I think it is interesting that specialization, globalization and the booming population of the world are being cited as possible causes for global warming. These particular things are directly related to the progress of mankind, at least in his economic and health terms. Truly, without these developments, it is possible that humans wouldn't have the time and/or resources to devote to global warming whether through researching, protesting, etc. Anyway, the article is below and obviously there are two sides to this intensifying argument.

Chilling Costs of Global Warming
May 31, 2008; Page A10

Mackubin Thomas Owens's op-ed "Blame Congress for High Oil Prices1" ( May 29) is great, except it only touches on how the environmentalists are killing our economy and now people, too.

Congress has bought into the so-called global warming issue despite the fact that 32,000 scientists recently signed a petition stating that man's being the cause of any warming was suspect at best. Even Jupiter warmed up one degree this year. Did we do this?

As a result, we have taken 30% of our corn to make 3% of our fuel. It takes one gallon of gas to make 1/13 gallons of ethanol. Ethanol then burns 80% as efficient for no net gain. But it's cleaner!

So the environmentalists have stopped our exploration for fossil fuels, stopped our expansion of nuclear energy, stopped our production of coal-fired power plants, and now have convinced Congress to turn our food into energy, starving millions.

Global warming is killing people -- they are right -- not by any potential warming, but by starvation and lack of energy.

Peter Holmes
San Antonio

Al Qaeda on the Run (wsj article)

I'm throwing out all my weekend journals from the past couple months and came across this article on al Qaeda. Anyway, I thought it was a good read on why America needs maintain a military presence (possibly on a smaller scale though) before returning home from Afghanistan and Iraq:

Al Qaeda on the Run
May 31, 2008; Page A10

A year ago in July, a National Intelligence Estimate warned that al Qaeda had "protected or regenerated key elements of its Homeland attack capability," meaning it could be poised to strike America again. The political reaction was instantaneous and damning. "This clearly says al Qaeda is not beaten," said Michael Scheuer, the former CIA spook turned antiterror scold.

What a difference 10 months – and a surge – make.

CIA Director Michael Hayden painted a far more optimistic picture in an interview yesterday in the Washington Post. "On balance, we are doing pretty well," he said. "Near strategic defeat of al Qaeda in Iraq. Near strategic defeat for al Qaeda in Saudi Arabia. Significant setbacks for al Qaeda globally – and here I'm going to use the word 'ideologically' – as a lot of the Islamic world pushes back on their form of Islam."

What happened? To certain sophisticates, this is all al Qaeda's doing: By launching suicide attacks on Shiite and even Sunni targets, and ruling barbarically wherever they took control, the group has worn out its welcome in the Muslim world.

There's some truth in this. The Sunni Awakening in Iraq was in part a reaction by local clan leaders against al Qaeda's efforts to subjugate and brutalize them. The Arab world took note when Abu Musab al-Zarqawi ordered the November 2005 bombing of three hotels in Amman, Jordan, in which nearly all of the victims were Sunni Arabs. Extremist Islamic parties took an electoral drubbing in Pakistan's elections earlier this year following a wave of suicide bombings, one of which murdered Benazir Bhutto.

It's also true that al Qaeda finds itself on the ideological backfoot, even in radical circles. As our Bret Stephens reported in March1, Sayyed Imam, a founder of Egyptian Islamic Jihad and once a mentor to Ayman al Zawahiri, has written an influential manifesto sternly denouncing his former comrades for their methods and theology. This was enough to prompt a 215-page rebuttal from Zawahiri, who seems to have time on his hands. Lawrence Wright in the New Yorker and Peter Bergen and Paul Cruickshank in the New Republic have recently written about similar jihadist defections.

But the U.S. offensives in Afghanistan and especially Iraq deserve most of the credit. The destruction of the Taliban denied al Qaeda one sanctuary, and the U.S. seems to have picked up the pace of Predator strikes in Pakistan – or at least their success rate. This has damaged al Qaeda's freedom of movement and command-and-control.

As for Iraq, Zawahiri himself last month repeated his claim that the country "is now the most important arena in which our Muslim nation is waging the battle against the forces of the Crusader-Zionist campaign." So it's all the more significant that on this crucial battleground, al Qaeda has been decimated by the surge of U.S. forces into Baghdad. The surge, in turn, gave confidence to the Sunni tribes that this was a fight they could win. For Zawahiri, losing the battles you say you need to win is not a way to collect new recruits.

General Hayden was careful to say the threat continues, and he warned specifically about those in Congress and the media who "[focus] less on the threat and more on the tactics the nation has chosen to deal with the threat." This refers to the political campaign to restrict wiretapping and aggressive interrogation, both of which the CIA director says have been crucial to gathering intelligence that has blocked further terrorist spectaculars that would have burnished al Qaeda's prestige.

One irony here is that Barack Obama is promising a rapid withdrawal from Iraq on grounds that we can't defeat al Qaeda unless we focus on Afghanistan. He opposed the Iraq surge on similar grounds. Yet it is the surge, and the destruction of al Qaeda in Iraq, that has helped to demoralize al Qaeda around the world. Nothing would more embolden Zawahiri now than a U.S. retreat from Iraq, which al Qaeda would see as the U.S. version of the Soviet defeat in Afghanistan.

It is far too soon to declare victory over al Qaeda. Still, Mr. Hayden's upbeat assessment is encouraging, and it suggests that President Bush's strategy of taking the battle to the terrorists is making America safer.

Places I want to see: St. Helena

St. Helena in the South Atlantic. Charles Darwin visited St. Helena during his travels and it is one of the most isolated islands in the world as noted in a Wall Street Journal article entitled "Darwin's Joyful Journey of Discovery" that was published on May 31, 2008.

Books I want to read: How the States Got Their Shapes

By Mark Stein and published by Collins, this 352-page cartographic tour of America seeks to answer through history why states received their boundaries.

Books I want to read: True Tales from the Annals of Crime & Rascality

This book is a collection of non-fiction crime stories from The New Yorker magazine by St. Clair McKelway. It is 339 pages in length and comes in a hardcover.

Terrorism's New Structure (from wsj)

The Wall Street Journal wrote what I thought to be a very interesting piece on terrorism and its religious undertones or lack thereof. Below is the article, which can also be seen here:

Terrorism's New Structure

The forces driving international terrorism go well beyond religion. Martin Amis on alienation, the thirst for power, the quest for fame and the inevitable use of weapons of mass destruction.
By MARTIN AMIS
August 16, 2008; Page W1

History is accelerating; and so the future becomes more and more unknowable. Among our foremost thinkers, we find only one presentiment that is universally shared. This turns out to be a sinister variation on the idea of "convergence." Not the convergence of nations and polities, whereby the world's autocratic regimes would gradually align themselves with the democratic and contentedly globalized mainstream. This particular expectation, even neoconservatives now concede, was a triumphalist fantasy of the 1990s -- that curious holiday from what Philip Roth has called "the remorseless unforeseen."

The convergence we have now come to anticipate is the convergence of international terrorism and weapons of mass destruction -- of IT and WMD. Even strictly parallel lines, I was taught, meet and cross in infinity. And the paths of IT and WMD are visibly inclined, like the sides of a tapering spire. Their convergence is guaranteed by the simplest of market forces. Marginal costs will fall; and demand will climb.

It has not been widely realized, even now, that America has already suffered a terrorist deployment of WMD -- as we have just been reminded by the one-man suicide mission of the troubled germ-scientist, Bruce E. Ivins, in Frederick, Md. This attack began on Sept. 18, 2001. The cost in blood was five dead and 17 seriously infected. The cost in treasure was over a billion dollars (the cost to the perpetrator, in a vibrant asymmetry, was estimated at the time to be as little as $2,500). And there was a third impact: the cost in fear. Anthrax is not contagious; but fear is. The scale of the attack was minuscule, yet for a while the terror filled the sky.

Unlike the poet, the novelist (see W.H. Auden's glittering sonnet of that name) assumes that his or her reactions to the main events (in life, in history) are utterly median, average -- predictably and dependably human. I am confident that my reaction to Sept. 11 was quite normative: a leaden and sourly mineral incredulity. It is with rather more diffidence that I divulge my reaction to Sept. 18: I followed the example of that large and flightless African bird which, when sighting a threat to its existence, chooses to bury its head in the sand.

This was the kind of information I was unable to contemplate:

Using one aircraft dispensing 1,000 kg of anthrax spores. Clear calm night. Area covered (sq. km): 300. Deaths assuming 3,000-10,000 people per sq. km: one million to three million.

The affective content of Sept. 18 ran as follows: you cannot protect your children (and I had and have five). Staggering, too, was the perceived magnification of the putative enemy's power. Al Qaeda swelled like a Saturn; and for a while they seemed to be everywhere on earth -- the whisperers, the nightrunners of Osama. Sept. 18 was very cheap, very terrifying, and hideously elusive. It entrained over 9,000 interrogations and 6,000 grand-jury subpoenas; and the case is not yet closed.

The anthrax letters contained two near-identical cover notes. The first said:

09-11-01
THIS IS NEXT
TAKE PENACILIN NOW
DEATH TO AMERICA
DEATH TO ISRAEL
ALLAH IS GREAT
READING INTO TERROR

After the subsidence of panic-flurry (the widely reported "sub-clinical hysteria"), no one took the cover note seriously, let alone literally. "Take penacilin now": this was sound medical advice (anthrax is a bacterium, not a virus), but the misspelling was obviously tactical -- a false lead, a false flag. No, we imagined a scowl in a lab coat, a Unabomber, a Timothy McVeigh with a doctorate. And so it proved -- or so it seems. (The FBI claims Dr. Ivins was solely responsible for the attack, but his lawyer says he was innocent.)

Sept. 18, then, was "not about religion." Was Sept. 11 about religion? This is still controversial. Both President Bush and former British Prime Minister Tony Blair, who are religious, were very quick to say that Sept. 11 was "not about religion" ("religion," hereabouts, being a euphemism for Islam). It then subsequently emerged that Sept. 11 was about religion -- or, at least, was not not about religion. But in the last year or two, it seems, we have gone back to saying that Sept. 11, and March 11 Madrid (2004), and July 7 London (2005), and all the rest, are not about religion.

The two most stimulating international terrorism-watchers known to me are John Gray and Philip Bobbitt. Professor Gray ("Straw Dogs," "Al Qaeda and What It Means to Be Modern" and "Black Mass") and Professor Bobbitt ("The Shield of Achilles" and the masterly "Terror and Consent") are utterly unalike, except in brainpower and literary panache. Mr. Bobbitt is a proactive and muscular Atlanticist, whereas Mr. Gray is almost Taoist in his skepticism and his luminous passivity. Mr. Bobbitt is religious, and Mr. Gray is philo-religious (or, rather, wholly reconciled to the inexorability of religious belief); but neither man is an exponent of relativist politesse. And they assert, respectively, that international terrorism is "not about Islam" and has "no close connection to religion."

Al Qaedaism, for them, is an epiphenomenon -- a secondary effect. It is the dark child of globalization. It is the mimic of modernity: devolved, decentralized, privatized, outsourced and networked. According to Mr. Bobbitt, rather more doubtfully, Al Qaeda not only reflects the market state: it is a market state ("a virtual market state"). Globalization created great wealth and also great vulnerability; it created a space, or a dimension. Thus the epiphenomenon is not about religion; it is about human opportunism and the will to power.

Then what, you may be wondering, was all that talk about jihad and infidels and crusaders and madrasas and sharia and the umma and the caliphate? Why did people write whole books with titles like "A Fury for God" and "The Age of Sacred Terror" and "Holy War, Inc."? There are several reasons for hoping that international terrorism isn't about religion -- not least of them the immense onerousness, the near-impossibility, now, of maintaining a discourse (I'll put this simply) that makes distinctions between groups of human beings. Al Qaedaism may well evolve into not being about religion, about Islam. But one's faculties insist that it is not not about religion yet.

Let me devote a paragraph to the British perspective. In the U.K., in 2007, there were 203 arrests on terrorism charges, nearly all of them connected to radical Islam. It is possible to open your newspaper (the Independent) and read about three thwarted or bungled cases of jihadism on a single day (May 24, 2008). The main purpose of the Quilliam Foundation, recently established, is to deradicalize young British Muslims. And consider the otherwise extraordinarily weak motivation of the four men responsible for July 7. Experience of conflict or of foreign occupation? No. A set of demands or the prospect of benefits? No. Community support? No. Familial approval post mortem? On the contrary.

Then, too, the rise of suicide attacks directed at civilians is astonishing -- and it is also astonishing how unastonished we claim to be in the face of it. Many commentators like to remind us that this tactic is a) nothing new, and b) nontheological, and then follow that up with a perfunctory reference to the Tamil Tigers, the godless Sri Lankan separatists who have been blowing themselves to pieces since 1987. The relevant essay in "Making Sense of Suicide Missions" (edited by Diego Gambetta and updated in 2006) states, of the Tigers: "There are no clear examples of civilians being directly targeted." Moreover, one database (quoted in the Times Literary Supplement) concludes that "over 80 per cent of all suicide attacks in history have taken place since 2001." Suicide bombing is a cult. Mr. Gambetta makes the haunting point that this weapon, unlike any other, is self-replenishing. The bomber uses up one martyr, but he creates many others; and "we know that the number of volunteers soars immediately after Ramadan..."
[Bruce Ivins]
Associated Press
Bruce Ivins in 2003.

It may well emerge that the use of religion is, or is becoming, merely a means of mobilization. Religion is for the footsoldiers, not the masterminds. At some later date we may see that religion provided the dialectical staircase to indiscriminate death and destruction. The idea, for instance, that democracy (fundamentally unclean) inculpates every citizen in its nation's policies; the idea (or ancient heresy) of takfir, whereby the jihadi pre-absolves himself of killing fellow Muslims. Interestingly and encouragingly, Ayman al Zawahiri is currently squirming about in a theological debate with the venerable cleric, Sayyid Imam al Sharif, as Al Qaeda itself is having to defend its religious legitimacy.

We can further expect international terrorism to become much more diffuse in its motivations, reflecting changes in the contemporary self ("a person's essential being"). Mr. Gray has identified a vein of what he expressively calls "anomic terrorism." This would be the carnage inspired by alienation, the self-extending despair evident in the random and serial stabbings in the cities of Japan, or the campus massacres in the U.S. -- or indeed in the threats voiced by Dr. Ivins during the weeks before his death. The historian Eric Hobsbawm believes that the pandemic collapse of moral inhibition has to do with a general coarsening, the desensitization of violence brought about by the mass media (and of course the Internet). This prompts some further points.

It is Mr. Bobbitt's thesis (which Mr. Gray, incidentally, tends to pooh-pooh) that the current conflicts are epochal, having to do with a shift in the constitutions of the polities of the West. As the welfare state evolves into the market state, it abandons many of its responsibilities to its citizenry, and concentrates above all on the provision of opportunities to the individual. This, I think, has clear consequences for the self: there is simply more pressure on it. In "Mr. Sammler's Planet," which appeared at the end of that great spurt of narcissistic eccentricity known as the 1960s, Saul Bellow has his elderly hero reflect (with delightful restraint) that mass individualism is relatively new and, perhaps, "has not been a great success."

Joseph Conrad's "The Secret Agent" (1907), with its dank crew of self-righteous sociopaths, is horribly prescient. Here we find (for example) the observation that merely to erect a building is to create a new vulnerability; here we find a revolutionist observing that the power of life is far, far weaker than the power of death. In his reading of the terrorist psyche, Conrad persistently stresses the qualities of vanity and sloth -- i.e., the desire for maximum distinction with minimum endeavor. In other words, the need to make an impression is overwhelming, and a negative impression is much more easily achieved than a positive. In our era, this translates into a thirst for fame. Probably no one under 30 can fully grasp it, but fame has become a kind of religion -- the opium, and now the angel dust, of the mass individual.

By some accounts it took the Ayatollah Khomeini several nauseous years of war with Iraq before he came to see the theological viability of nuclear fission (and the groundwork was then begun). Osama bin Laden has never made any secret of his admiration for WMDs: "It is the duty of Muslims to prepare as much force as possible to terrorise the enemies of God" (statement entitled "The Nuclear Bomb of Islam," 1998). All these tools are now for sale; and how very remarkable it is, in the larger scheme, that the world's first megadeath madam, the metallurgist A.Q. Khan, is "a national hero" in Pakistan.

There is another good reason for wanting international terrorism to stop being "about religion." One can think of scenarios of extortion, compellance and ransom, but only an eschatological dream could justify the clear calm night and the three million dead. On the other hand, the actors would unquestionably make an impression; and it would be super-geohistorical in size.

International terrorism, for now, represents a puny apocalypse. Mr. Bobbitt is as droll about this as anybody: since Sept. 11, "the total number of persons worldwide who have been killed by terrorists is about the same number as those who drowned in bathtubs in the US." But at any moment it -- IT -- could go from nothing to everything. After an untraceable mass-destructive strike on one of its cities, what political system would ever know itself again? And all other states would be unrecognizable too, as would relations between them.

Martin Amis is the author of 10 novels. His most recent book is "The Second Plane."

Sunday, February 10, 2008

Green Lion

Most often in connection with Alchemy. Vitriol was the most important liquid in alchemy. It was the one in which all other reactions took place. Physically the Green Lion was usually a name for vitriol, or the sulphuric acid created by distilling the green crystals of iron sulphate in a flask. Iron sulphate was formed when iron ores rich in sulphides were left to oxidise in the air, so was readily available to medieval alchemists. The sharp penetrating sulphuric acid could create major chemical changes in many materials even to the extent of dissolving metals like iron, and copper. This Green Vitriol is symbolized by the Green Lion in drawings. After the Green Vitriol (copper sulfate) was collected, it was heated and broken down into iron compounds and sulfuric acid. The acid was separated out by distillation. The first distillation produced a brown liquid that stunk like rotten eggs, but further distillation yielded a nearly odorless, yellow oil called simply Vitriol. The acid readily dissolves human tissue and is severely corrosive to most metals, although it has no effect on gold. White Vitriol is zinc sulfate; Blue Vitriol is copper sulfate.

The Green Lion could also be the nitric acid formed from heating saltpeter or nitre and iron sulphate. Nitric acid when mixed with the acid derived from common salt, hydrochloric acid, produced aqua regia, a greenish tinged liquid that could dissolve even the noble metal gold. The Green Lion devouring the sun is a famous image in alchemy being depicted in many manuscripts and engravings, and can be thought of as aqua regia dissolving the solar gold and forming a solution which could readily tinge metals with gold.