Where is the money?

Some of this may seem moot now, what with Goldman making oodles (the WSJ counsels us to not 'hate' them for it - I say, yes, it's more evidence of near-zero) and with the increasing levels of the equity markets though they are still below the 2007 peak. But, we need to look at money in its various senses and existences. Even the Pope knows of its importance.

The post is precipitated by Marilyn's answer in the Sunday Parade to a subject that had been handled earlier by Investopedia.

• Marilyn: Where did the stock money go? -- if she were not so smart, I would worry about her being disingenuous. Sounds more like she has been taken in by those who want to perpetuate what is essentially the big pocket picking scheme.
• When Stock Prices Drop, Where's The Money? -- no doubt, these guys are into financial engineering which seems to always move toward pocket picking. But, then, so too does government action seem to run this way. The little guys cannot seem to get a break. (italics added on 8/2/2009 - see Remarks, same date)

Both viewpoints are a little misleading. Why? Several reasons described below.

For one, they do not consider nuances of 'intrinsic' as it applies to value that have been thrown out as not necessary (gaming can be partly to blame). Let's call it Okkam for convenience of the favored. Then, there are some temporal issues that are not addressed. First, a little background is necessary.

What we have is a bunch of people passing along the same few bucks. We can take any number as the basis though the Fed tries to really pin this down. Remember that the Fed can print as many virtual bucks as it want in the fiat situation within which we find ourselves.

These bucks pass at a high rate of speed to where some illusion rises that makes us think that there is more than those basic bucks. Ah, yes, delusion at its best. The illusion is, in part, due to the leveraging notions that have gotten out of hand, but, too, it relates to the casino effect (ca-pital-sino) that has grown to underlay things monetary.

A proper audit (to be defined), from time to time, would allow us to see just how few bucks there really are. We do not have to have the shaky times like we're seeing now where real people get hurt in order to do this audit. Of course, we do know that some of those who are richer (by definition of some, smarter) find themselves in a bind, too.

Now another way that the two articles are misleading is that they do not consider the leech effect. As well, through time monies go into the pockets of the several along the way who sold for more than they bought in the past. Some of it definitely would be in the pockets of those running the game. So, you see, there is a temporal issue that seems to be missing.

Today, the markets are up sharply. Of course, the interest rate is low, but who is lending for speculative buying? Supposedly, liquidity is still not what it was. Some say we're heading to a 15,000 DJIA (who is to know?).

There is definitely more to consider here, as we go along, than just a simple metaphor.

Remarks:

03/06/2014 -- An update of this theme.

03/03/2010 -- Applies to the debate about MM and equity/debt.

08/27/2009 -- I need to add that the explanations by these two emphasizes the multiplier effect of a fiat currency scheme. However, as the arguments against marking to market tell us, the additional effect is not, by necessity, ponzi or just hot air. (links pending)

08/10/2009 -- As promised, FEDaerated is here.

08/02/2009 -- Wait! More exposures: "computers, some housed right next to the machines that drive marketplaces like the New York Stock Exchange, enable high-frequency traders to transmit millions of orders at lightning speed and, their detractors contend, reap billions at everyone else's expense." To anyone who isn't at Goldman Sachs or the like, does that appeal to you as the way that we ought to be handling our beans?

So, is this what financial engineering is all about? Sounds more like leeching. We'll look further as part of an econoblog. Where is the money indeed?

07/31/2009 -- Let's see, 5,000 got over $1M for services rendered. Well, that's probably a sign of being a best-and-brightest, at least to certain eyes; it's called rolling-in-the-dough.

Now, this can be used to illustrate how the game it to fill the pockets of a small set to an exorbitant amount. Does the game need to be that way? Hell no. We'll look at that some more.

07/30/2009 -- Note, everyone, the run up of the DOW lately. I'll agree that a lot of this may be fictitious capital, that is, gained through gaming means. Yet, the movement is real. So, where does the money go when equity tanks? It moves to another look, morphs, if you will (money, no better shape changer exists).

07/29/2009 -- The use of intrinsic will need some discussion, as we don't have to go to the level of t-issues. Rather, there is a broader notion that gets lost in the finance's watered-down abstraction. This theme will be central to the new econoblog (leaning toward FEDaerated).

03/06/2014

Truth engineering

This blog started two years ago with the purpose of looking at issues of computation interacting with being (ourselves, so to speak). That is, we have expertise which has been honed through myriads of years and which has been extended through generations by memes and which is still not sufficient to cover a whole lot of problems (yes, the infamous world hunger, getting a project done on time, and more) that is not capable of handling computing (and truth) without some significant changes (and, it's more than just handling hogwash).

Oh, yes, there are plenty of worldviews with answers already determined even though our experiences can indicate (except to those best-and-brightest who are completely entralled with their own mind's eye) that underdetermination is really our most frequent state (and we learn to make guesses to fill gaps - albeit this can be fun, too).

So, the original issues being addressed were general, such as things in themselves, tribal dynamics, temporal influences, the sirens of abstraction, those who know it all. There may have been a leaning toward engineering in the beginning as the focus for discussion, but finance/economics soon raised its head as of interest to the theme.

As it turns out, both engineering and economics have been unending founts of examples that can be used for motivation and illustration. The 787 controversies of the fall of 2007 created the need for a look at those issues, and that caused an engineering focus for awhile. In fact, the first post, beyond the Seeds, was looking at abstraction's appeal which has a very strong pull.

Just, look at the mess of the economy due to faulty mathematics.

That economics could offer such a wide range of topics related to truth engineering became apparent as engineering does work for the most part (are we not besieged on all sides by products demonstrating engineering prowess?).

We will show that it's the manager mindset that get things screwed up. Over the past couple of years, plenty of the discussion about the looming problems of the economy was right on. It was obvious that things were awry due to fundamental issues and, now we might add, that many of these were not resolved in the crash.

The past few days has the WSJ exclaiming that Goldman Sachs is making money hands over fists. Well, didn't they get a bailout too? Fold themselves under a wing of a government shelter for protection (ain't that so sweet?)?

You see, GS represents that part of the economy that is hardly useful (though, leeches do have an acknowledged medical use) except for its abilities to do the major sucking out of the pockets. Who is looking at their stuff in detail?

Well, will the new day handle these issues or will we just go back to the normal idiocy of a game run by fat cats that consumes lots of resources in maintaining itself and that, for the most part, is not necessary - yet, seems to be taken as some extreme example of the virtues of capitalism?

Oh, of course, casino capitalism.

Remarks:

11/30/2009 -- From 'Our basis' can grow a whole bunch.

09/09/09 -- We'll need to look at UUUN, as a framework.

09/08/2009 -- System risks are still there.

09/03/2009 -- Computational foci raise miraculous need. Yes, we need to talk NP and more way to cope. Take, for instance, truth maintenance which is NP, yet that is no deterrent for the effort covered by the blog. Why? Ah, we're getting to that.

09/02/2009 -- Lean assumes a current framework which can be improved. That the process is still effective during the change can be checked easily. However, if it is not still effective or we do not have a stable framework, then we were, by necessity, in the undecidable state.

Modified: 11/30/2009

Homo economicus

Pope Benedict has good timing in writing about Homo economicus as we will be better able to look at some big-T issues, from time to time. Ah, we now need something similar about engineering.

It's interesting to see the reaction from the news community (many of these are business fluent).

• USA Today
• BBC
• CBC
• Globe and Mail
• Economist
• WSJ
• ...

The list is just a sampling and does not indicate any order or agreement with the reviews. We'll deal with the Encyclical's content itself, from time to time, pointing back, of course, to prior discussion here.

Remarks:

02/09/2013 -- This year, we'll get more into t-issues. Plenty of people are looking at science/religion topics. Too, Dawkins was quoted as saying that the existence of God ought to be subject to a scientific test. This can be arranged, given the right framework. Perhaps, I'm too old to see it, but its day will come. And, with its advent, we would not have an explanation, necessarily. The benefit? Progress of a nature not seen due to the dampening related to not allowing the broader views. Mind you, science getting into religion may help root out all of those accumulated bits of dross which are so problematic (too many to name here, but I would attempt such an enumeration if there were interest).

01/22/2013 -- T-issues will migrate to issues of science and religion.

01/01/2011 -- Paul as CEO.

08/10/2009 -- As promised, FEDaerated is here.

07/31/2009 -- Let's see, 5,000 got over $1M for services rendered. Well, that's probably a sign of being a best-and-brightest, at least to certain eyes; it's called rolling-in-the-dough.

Now, this can be used to illustrate how the game it to fill the pockets of a small set to an exorbitant amount. Does the game need to be that way? Hell no. We'll look at that some more.

07/29/2009 -- This theme will be central to the new econoblog (leaning toward FEDaerated), especially as we deal with people issues, yes, more than labor to be exploited under outsourcing as colonization.

02/09/2013

Smooth and not

The idea is to eventually get to wing-body join issues, at least, exterior configuration. However, a side track down a data analysis road seemed to be apropos (at the time), especially since noise is as ubiquitous as a problem as is the computer in its growing ever-presence.

And, we're talking modeling noise (yes, logic). The discussion is important in that CAE and other programs of this sort that are becoming increasingly in vogue. That is, concept through design to resolving manufacturing issues to testing and then to production use and support is a long and difficult road. Any where along the line, noise (used metaphorically as equivalent) can erupt.

Yet, most assessments (of virtual results) are visual - visualization is the technology. Though, one would wonder when we will bring in the other senses, such as the nosethatknows.

Now, there is another type of 'noise' that is on the operational side and important to the discussion. It's called flutter, and its handling is part of what modeling is trying to do.

Remarks:

07/05/2009 -- One goal of these posts was trying to get to where there can be a discussion about obtaining continuous and smooth from disjoint and lumpy in mathematical modeling. That is, this type of abstract process puts heavy demands on the computational elements in terms of structure and properties. And, yes, folks, open issues still abound, some of whose complications are very much overlooked.

Modified: 07/06/2009

Truth and noise

We were briefly looking at some wing-body join issues and decided to talk about modeling related to fairings which would be part of the exterior design. Remember that the recent problem dealt with the internal structure which can be analyzed and tested statically; the external configuration would impact performance in the air.

Now, since we didn't have specifics, some general issues can be addressed. One deals with noise which could be of several types, such as from representational mismatches. Modeling grapples with this type of thing all the time. Knowing about the information and data that is involved is an integral part of any knowledge state.

Many times, truth is both contextual and situational, even if we consider what we can know of the big-t issues. Hence, an operational viewpoint can be our most effective means which then brings up processing which then, in the modern times, involves computation (which is becoming ubiquitous).

Ah, that little thing has grown to be very problematic and will continue to be such.

So, we can assume that a fairing would need to be smooth to reduce complications related to drag. What would smooth mean?

Well, the concept is not unlike what people are used to. Smoothness can be determined by senses; even sight can be used, as a smooth surface is appealing to the eyes in certain circumstances. For instance, the polished look relates to smoothness.

How is the idea of smoothness expressed on the computer via model? Well, it's not as easy as one might think. But, again, a lot of work has gone into this. Let's just say that one has to deal with changes with time (the concept of the derivative in calculus).

For those who drive, you probably heard that applying pressure steadily to the accelerator (which you press to move) so that you have a 'smooth' increase in speed helps with mileage. If you graphed the change in speed, you could then see how well your foot's action worked.

But, consider what would happen if you hit the accelerator in a spastic (perhaps, random) fashion. The car would jerk as it changed speed (up and down) trying to respond to your foot. Of course, there would be low mileage; but, any progress toward the destination would be very slow.

Let's look at an example that isn't specific to wing-body joining but applies nevertheless.

Remarks:

09/13/2009 -- Will look further into the necessity of the sandbox.

08/20/2009 -- Note 1: 'Derivative(s)' has been used a few times in the posts. The context may imply the usage, hopefully. But, in general, we're talking two types. 1) from finance, where 'derived from' is the proper interpretation (or as one may surmise from posts here and elsewhere, something from nothing). 2) the usual mathematical variety.

Modified: 08/24/2011

Fitting fairings

As said, the wing-body join's dynamics are not easy to design for. A design would encompass both the internal structure (where a problem has been found) and the outside cover (which would include a proper fairing). And, fairing design requires higher-order mathematics and real knowledge.

A lot of technology is involved in aero engineering parts, like the fairing, but let's just look at a modeling part of the problem. The fairing and wing design would involve a closed volume which has a surface (albeit a collection of entities that may or may not be smooth - the leading edge, for instance, has stronger requirements than aft pieces) as its boundary.

Creating and analyzing these entities encompasses the design part of the problem. Then, there are the issues related to manufacture. That is, one can model assemblies and parts for design, function, and make issues. At many points, the model can be evaluated to allow choices between alternatives using techniques that require serious computing. Specifics related to materials and methods can be scrutinized.

Since we outsiders don't really have specifics, a little general talk might be of interest. One part of the problem is how do we extract information from data? That is, the fairing surface may have to fit point-set data derived from a CAE program (flow, for instance) which had defined how the entity that meets aerial requirements looks and functions (data). Well, a point-set is not an operable surface, in the context of CAD/CAE/CAM (See CAx).

One can take this problem a step further and consider how sampled data that has measurement, and other, error can be fit so as to extract what the data shows. As an aside, manufacturers, including plane makers, use reverse engineering a lot which is a fitting problem. So, relating to the wing/fairing design, an operable design structure needs to be discovered from the data derived from aero analysis.

So, one of the many things to consider would be noisy data.

One might ask, though, how can data from a CAE program be noisy. Well, it has to do with the differences between representations (necessary both for the model and the mathematics) and the constraints that need to be met, in part. Think of it this way. If you hear something in a language that is unknown to you, does it not sound meaningful, or like noise?

One big problem in modeling by computer is the serious mismatch (several types) that can occur despite a lot of effort and sweat, though some progress seems to have been made.

Modified: 08/24/2011