It is Obvious

Chris Rick has got altogether too much to say

Archive for December, 2012

EU be or not EU be

Posted by chrisrick13 on December 23, 2012

It is obvious: decision making is easy

We can make the decision to be in the EU by the simple equation: do the benefits exceed the costs.

If the benefits exceed the costs then someone else is paying us.  We have no decision to make, the payer does.

That is today’s decision for someone.  What if we look into the future?  We may see a scenario where costs today will be handsomely repaid with benefits into the future.

Does the EU look like an entity with a future?

It is obvious: decision making is easy – correct ones are more tricky.

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Who am I?

Posted by chrisrick13 on December 23, 2012

It is obvious: I’m a man

Systems in general if left to themselves will ‘hunt’ which means to oscillate between two or more states, or move to a stable state.  We build systems with negative feedback so that they are stable.  There is a problem that systems are contained within higher systems so that you might be able to deal with a system but there is always a higher level system that you cannot deal with.  So the UK economy can be controlled (sic) but the higher level one, the global economy cannot.  It is obvious that the global economy is made up of the economies of many countries and there is little hope of controlling it.  There are many mechanisms in place that try to link national economies in some order, but no attempt at global control…which would not work anyway.

There is much talk of ‘market forces’ which is an expression of letting a system move to stable state.  Many will but many won’t.  Governments meddle but they do not ever provide negative feedback.  They only change the nature of the system and other nearby systems.  So why do they persist in doing it?  Any change though means the system will change either to hunt or to move to another stable state.  Even the move to stability is usually a set of decreasing oscillations around that stable point.  So new laws and regulations create oscillations even if they eventually die down.

Last week there was a significant event of more importance than anything the Mayans might have come up with.  On that day the cost of car insurance for under-25 girls went up by as much as 50%.  Should have gone down by similar amounts for under-25 boys…but it didn’t.  Better to be a man though.  An easy decision.

Also on that day the return on retirement annuities for men went down.  A good day to be a woman.  The return on retirement annuities for women should have gone up by the same amount…but it didn’t.  This is a tricky time to decide on an annuity.  Rates are very low and governments are doing things (low interest rates and QE) that are pushing annuity rates down.  However it is difficult to judge if things will get any better.  Should you hang on before fixing your annuity rate?  Certainly a decision point passed on Friday.

There are other effects as a consequence of an EU regulation coming into force which prohibits discrimination on the basis of gender.  Like that executive toy the shiny ball-bearing on string has been pulled up and let go.  In particular for pensions the adjustments have been made by the insurance companies, but funnily enough there is net less money coming to annuitants.

I feel poorly equipped to make the annuity decision.  After a life of work I am faced with making a decision that will have big effect on the rest of my life as a retiree.  It would be easy to negate a large percentage of my efforts to provide retirement income.  I have to put it in the hands of some expert who I have little confidence in.  It’s somebody else’s money to him.

I have come back, unexpectedly to one of my own themes: invest in yourself and plan to work all your life at some level while enjoying all your money while you are in a good state to do so.

It reminds me of Hot Black Desiato in the Hitch Hikers Guide to the Galaxy who would not talk to Arthur Dent as he was being dead for the year for tax reasons.

It is obvious: I’m a man but I ought to be half a woman for some of the time at least as well as half retired.

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Mind your fingers

Posted by chrisrick13 on December 13, 2012

It is obvious: all the horses are here

European finance ministers agreed a deal on the rules for supervising Eurozone banks earlier today.  This also enabled them to release Greece’s £27bn that should have been paid in June.  I do not understand what the deal is.  It will be interesting to see what the unbiased commentators make of it.

The deal is expected to take effect in March 2014.  I’m not sure if that means that it will take that long to set up or if the deal is ‘in principle’.

I am sure of a couple of things though.  First it is  not a deal.  It is words on paper that enable the money to be given to Greece and meets various political and election objectives over the next few  months.  The detail and the commitment will be missing.

Second, I am sure that we won’t get as far as March 2014.  Long before then it will become irrelevant.

One of the things I have missed out on is to note all the deals, agreements and actions that are promised within the EU.  I needed to note just how far into the future these events are and then as the time passes note whether they actually happened.  Perhaps I will start.

It is obvious: all the horses are here so it must be time to start on the stable doors

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Blog 500

Posted by chrisrick13 on December 11, 2012

It is obvious: this is blog 500

These decimal milestones present a small opportunity for reflection.  I rail against decimal anniversaries.  I should celebrate 512 which could easily come before the end of the year.

I notice that I am repeating myself.  I must have expressed my life’s philosophy.  Did not take much.  Clearly I am not a philosopher.

Repeating has also meant that I am seeing trends that I did not see before.  So there is some enduring, small, use to this…apart from being fun.

It is obvious: this is blog 500 – it says so on the tin.

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Good Idea 676

Posted by chrisrick13 on December 11, 2012

It is obvious: simple solutions work well

My garden is home to a lot of foxes.  They start out as fluffy, bushy, happy things.  Endemic mange then gets to them from their parents.  Soon you realise how little of a fox is fox and how much is (was) hair.  Then the first few days of cold come along and all the parents die.  Foxes litter the lawn…until they are eaten.  Even if the children die also new foxes turn up in short order.

I remember that there was a lot of noise about the prostitutes doing their trade around Kings Cross station.  Eventually the police were forced to do something about it.  After tripling man-power in the area for a couple of months prostitution was closed down in that area.  It moved a couple of hundred yards down the Pentonville Road.  The problem in Kings Cross was solved so police numbers were reduced in the area.  The infrastructure for prostitution had been built in the Pentonvile Road and it continued to thrive.  The infrastructure around Kings Cross was still there and rapidly returned to previous levels.

Institutional vacuums never work.  Institutions never learn that they don’t work.

The minimum cost of alcohol is is being raised.  This will stop people drinking.  Luckily it won’t have any effect on me as I mostly drink red wine that costs more than the minimum £4:50 price.  I will shoot any restaurant manager who tells me he has put his prices up due to government minimum pricing regulations.  Has it not occurred to decision makers that putting the price of alcohol only reduces consumption in those for whom alcohol is only a small part of their lives?  For those reliant on alcohol they either expand their income through illegal means or start making their own.  Raising the price of alcohol does not solve the problem it was introduced to solve.

Drug abuse is subject to another attempt to solve the prostitute problem.  This country (and many others) tries to stop the drugs getting in.  It also goes to war in Afghanistan and tries to stop production.  There is a much simpler solution.  First of all acquire as much of the drugs as it is possible to acquire.  Encourage production in Afghanistan and other places.  Buy the drugs off those countries.  Double the efforts to seize illegally imported drugs into the country.  Join the seized drugs with the bought drugs and sell them to drug addicts for token amounts.

This will turn organised crime away from drug production as there will be no profit in it.  They will move to other things.  The drug addicts will no longer steal/mug/cheat to get money for their habit.  They will be able to afford it from coins dropped by accident in the street.  They will mostly over-dose and quickly kill themselves off.  So the NHS costs will be reduced as well as policing costs.

There is an opportunity for the government to cut the pure drugs it is selling with some useful chemicals.  Small amounts of some poison that will build up in the body and eventually kill comes to mind.  If a compound could be developed and added to the drug that made the user intolerant to the drug then they could be weaned off their addicted drug…to addict themselves on something else more convenient.

Over time the costs to the country reduce.  Organised crime has moved on to new crimes.  Addicts are dying in large numbers.  The price paid to farmers can be reduced and they suddenly find they can get more money producing, say, wheat.  NHS costs are down.  Crime is down.  Police costs are down.  Selling seized drugs in the early days will fund the programme.

This is a win-win solution.

It is obvious: simple solutions work well and, alas, for many their time will come

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One is not a good sample

Posted by chrisrick13 on December 9, 2012

It is obvious: there are a lot of risks in life

Do your remember when nuclear power stations were green?  Carbon dioxide producing power stations were bad and there was not going to be enough electricity produced from renewable and (perhaps) non-polluting power sources.  This made nuclear suddenly a good option.  Step up the earthquake in Japan and nuclear is off the agenda.

Do you remember that we had to get out of gas power stations?  North Sea gas is (was) running out.  However Russia was playing ducks and drakes with gas and using it as a political weapon.  Being dependent on Russian gas was anathema.  On Wednesday production of 30 new gas power stations was announced.

Wandering the internet I saw the following about the destroyed nuclear power plant in Japan:

Gundersen (who used to build spent fuel pools) explains that there is no protection surrounding the radioactive fuel in the pools. He warns that – if the fuel pools at reactor 4 collapse due to an earthquake – people should get out of Japan, and residents of the West Coast of America and Canada should shut all of their windows and stay inside for a while.

At least the mutations caused will increase bio-diversity.

It is obvious: there are a lot of risks in life and with all the interventions of the state they still seem to be increasing

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Can you believe it?

Posted by chrisrick13 on December 7, 2012

It is obvious: there is a conspiracy going on

I saw this quote on the internet:

“They have a bit of a balancing act at the moment,” said Ross Walker, chief UK economist at RBS, “because inflation is a little bit above its target and is expected to stay there for several months.

“But at the same time the economy is still quite weak as we saw with yesterday’s forecasts [from the OBR].”

I do not know how to contain myself.  Inflation has been above target for more than 3 years and for much of that time has been twice the target.  Then he talks about a forecast where the OBR has changed its ‘forecast’ for this year to a shrinkage of 0.1%…when we are most of the way through the year.  It forecasts not much better for next year and leaps up for the year after that.  If the average error for those time periods are applied to the figures then the OBR is actually forecasting tha the economy will shrink into the distant future.

How he can keep a straight face when utters this tosh I do not know.  How the BBC can publish it without putting in some reference information to put those comments in perspective I do not know.

It is obvious: there is a conspiracy going on based on the premise that we are all unutterably stupid

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It is simple

Posted by chrisrick13 on December 6, 2012

It is obvious when you are in a hole

I had a wander round that unreliable beast, the internet, to see if there is a consensus on total UK indebtedness of all kinds by government, industry and population.  As you might expect there is not one but £10tn is a number that few of those who stood up to be counted would want to see lowered.  Take a moment to contemplate that number: £10,000,000,000,000.  If I ‘4-cents-a-passenger-mile’ it then it is £200,000 for every person in this country.  There are 5 in my family.  Were I to sell my property, cash in my pensions, clear savings accounts, and empty the penny jar I could probably do that.  Hold on a minute if everyone else is doing the same who are we going to sell property to?  So we would have to look North of me for anyone who could pay their bill…and there are a lot of people south of me.

In the autumn statement, which I did not listen to, the chancellor was talking about stuff where the money involved was of the order of a billion here and there but whose net effects were much less.  That number in full: £1,000,000,000.  A mind-boggling number…or it used to be.  However he is working at the level of 0.1% of the problem.  Given that all debt does not need to be paid in a growing economy he might be working at an effective 0.5%.  All that he is doing is placating public opinion and waiting for a cheque in the post.  I like to play the memory game: do you remember when we went to China to see if they would put a cheque in the post?

I did listen to Mr balls.  I have to go with the obvious play on words.  I can only observe that he has a lot of balls to stand up and say the outrageous things he has said.  This is mainly because of his hand in making sure we were in a very poor place to handle this crisis.  I might play the history game again and ask who said that we were the country in the strongest position to come out of the economic crash?  It is a line straight out of 1984.

Mr Balls has said that we have to have growth.  He is 100% correct.  Nothing else will get us out of the place we are in.  Then he falls apart.  He says that we’ll invest (that means spend) and growth will occur.  Simply he is wrong.  Were it that simple I’m sure that not only would Osborne do it, but so would every other country.  Let me name a few: Greece, Portugal, Spain, France, China, USA.  Growth is not a simple matter to achieve.

Were growth to be achieved then the extra money could be used to pay down debt.  However there are few occasions where a government (or despotic ruler) has decided at a time of growth to repay debt so that some future government (or despotic ruler) would be in a good state to bridge an economic recession/depression with a little affordable borrowing.

So what Osborne has done with the economy has had little effect.  Early talks of ‘Tory cuts’ have gone quiet – he has not managed any.  He has tried to cut the rate of borrowing and has not yet even considered the case were there is no borrowing and debt can be repaid.  This is a virtuous circle by the way.  If debt can be reduced then interest payments are reduced and the amount of money needed by government is reduced.

So Osborne is ‘fiddling while Rome burns’.  There is nothing he can do.  Balls can scream all he likes and I think he is enjoying himself because nobody challenges him about what he will do.  He is also terrified about winning the next election because he is committed to borrowing lots on the basis that what he does will get growth and enable debt to be repaid.  He knows that nothing he can do will create growth.  The UK is dependent on external events to get growth, events that will not occur.  Should he gain power with his spending commitment then the people who lend money (the ‘market’) will stick interest rates up and Balls will not be able to borrow money.  Indeed as debt rolls over he will have less and less money to spend as he has to pay interest.  Follow that logic to its conclusion.  Balls might scream that it is not his fault…but it is.

It is depressing to hear Osborne talk about growth.  There seems to be a mantra that if we build modern factories and the infrastructure to support them in what they do and train the young generation to operate those factories then we will achieve growth.  It may well be the case but there is nothing that links that strategy to growth.  There is no guarantee.  There are more chances that it won’t than that it will.

A brief return to exponential maths.  Should the economy get 2% growth then we might be in a good position to get out of our hole.  The economy will double in size before 2050.  Obviously it won’t.  The other feature of the exponential growth curve is that it is flat early on.  10 years of 2% growth gets an increase 21.9% from the starting point – the compound growth is only 1.9%.  At year 35 it is 100% and the compound growth is starting to help at 30%.  So even unachievable growth will not help early on.

The only way out of the hole if there is no growth is to default on the debts.  That would be a giggle except that a large part of that is effectively held by public and private pensions in the UK.  Your pension…and mine.


It is obvious when you are in a hole, but to surprisingly few people

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I need a brick – I want to be subtle

Posted by chrisrick13 on December 5, 2012

It is obvious: tornadoes and hurricanes do little lasting damage

Friday was an interesting day after the publication of the Leveson report.  (I am one of the few people in the country who can both spell and pronounce his name properly).  It was also the day after 3 by-elections.

I put the 24-hr news on before the 9pm curfew (in our house) and ‘dipped’ into the news when I passed or had a break.  The three constituencies are Labour seats and have been for many, many years.  They could put a Labour plate of cold cabbage up and it would get voted in.  Yet when I heard the item on the news I only heard that Labour had won the seats.  Not once did I hear that Labour had held seats they have never lost.  Not once did I hear that seldom do government parties do well in by-elections.  I did hear a lot of speculation about UKIP.

On the same day I read on the BBC web pages that France had entered a shallow depression.  Certainly on the numbers France is in recession.  How was the decision made to call it shallow?  Perhaps they could have said that France had entered recession and all the projections show that it will continue and get deeper?  Indeed suppose, as seems likely, that the French recession does get worse on the figures in 3-months will we see an apology that last week they prematurely said ‘shallow’?

Recessions are also often termed ‘technical’ recessions.  I wonder what the difference between a recession and a technical recession is?  If I fill in from my own prejudices a technical recession is one where the numbers show it, but the reality of the economy is that things are going well.  So here there is a position being taken by the news disseminator.  Again in 3 months if the numbers get worse are we told that the technical recession has become a real one?  What are the criteria?  To say that growth averaging -0.2% over 6 months indicates that the economy is in recession says it all.  Except even there I have expressed it as negative growth.  Should I have said that the economy shrank by 0.2%?

I have sympathy for the…’media’…it is a very difficult line between reporting facts and giving opinion or shaping opinion.  I think that I cannot be shaped, but a lot of these nuances just go past unnoticed and I am shaped.  Often it is friends who point them out to me – I would not get them on my own.  Should the news media be banned from using adverbs and adjectives?

The press have…a bad press.  They deserve it.  They have not done well at all.  They have been left to run their own affairs and are failing in many respects.  I am very sure that, whatever solution to their failings is arrived at, putting politicians, who have run our country so well, in charge will not improve matters.

It is obvious: tornadoes and hurricanes do little lasting damage it is the nibbles of termites that really destroy things

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Just when you thought it was safe to go into the water

Posted by chrisrick13 on December 4, 2012

It is obvious: No 11 busses provide a regular service

I remember when I was a 20 something working in an office with 6 like-generationed people.  The other person in the office was 50+ (and looked 70+) and smoked which he declared it his right to so do.  We could do nothing…officially.  We organised and one Monday morning when he arrived his desk was surrounded by 7 mains driven air filters.  He was extremely annoyed, but by the same token there was nothing he could do.  At the end of a fortnight we put the 7 yellowed goo dripping filters on his desk.  Because of the disruption to the 7 of us and his low productivity the management moved him.  Not for health reasons though.  This was the same office where we had a group coffee maker.  It was a Russel Hobbs.  On the card on the front door we added R. Hobbs to the occupancy list.  Good joke until the fire people came round and R. Hobbs was included on the evacuation list.

Around the same time we used to go to restaurants and nearly had stand up fights when we were eating and the people at the table next door lit up cigarettes.  Several times the managers ejected us rather than the smokers.

It was around the time that the tobacco companies were coming to the end of a 20 year rearguard action casting doubt on the link between smoking and disease.  How they managed to get away with it for so long I do not know.  In Australia they have come to the end of the fiction that their advertising was about getting brand loyalty and not trying to get people to smoke.  From last week they cannot distinguish their brands other than by different, small, letters on cigarette packs otherwise covered in lurid pictures of diseased bits of humans.

In this country cigarettes cannot now be openly displayed.  Except that everywhere I go they are because there are so many exceptions and dispensations.  Only the big supermarket chains are forced at the moment.  I notice even there though that the doors that cover the packets have big signs on them saying that if you can’t see what you want just ask for it.

In the face of compelling evidence still there is much more to be done to make cigarette smoking a difficult habit to start and continue.

So yesterday I was reading a report on carbon emissions.  They are going up at a ferocious rate.  After all the talk of the problems this will cause and the promises made at Kyoto for example, nobody is actually doing anything.  Part of the reason is that there are people who are saying that global temperature rises are not going to happen.  I didn’t mind people smoking and dying prematurely of nasty diseases.  I do mind being wiped out by global temperature rises.  I particularly mind that the temperature rises are killing off the coffee trees.  I mind that our weather is becoming much more variable.  I might mind it that when the temperature rises by 6 degrees there won’t be much left but I will be gone before that happens.

We are so distracted with other things that global warming has moved out of everyone’s consciousness.  Has nobody noticed that extremes in weather are on the increase worldwide?  A 2% rise in temperature will go a long way to fixing population increase (but not over-population) and my coffee addiction.

It is obvious: No 11 buses provide a regular service but they still turn up in two’s and three’s

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