Friday, January 3, 2014

3/1/2013: BRIC PMIs signal nasty end to 2013


Via Markit Economics:


The above shows the problem with the BRIC grouping: general lack of growth momentum, albeit driven by two different sets of forces.

For Brazil and Russia: domestic economic expansions are starting to fizzle out as debt (Brazil), public spending (Brazil) and consumer spending (Russia) are no longer capable of sustaining previous rates of growth. For India and China, growth is also a challenge, but here core drivers are lack of consumer demand growth in advanced economies (China), too much debt and late stage development of assets bubble (China), reduced capacity for services exports growth (India) and dysfunctional domestic markets (China and India). Note that India's relative outperformance in the group comes on foot of longer and deeper contraction in more recent past.

This is uglier than the Euro area effects when it comes to global growth. Core point is: who will be driving growth around the world in 2014?.. Unless the above momentum is reversed, the answer to that question is: no one in particular...

Thursday, January 2, 2014

2/1/2014: Markets, Invisible Hand & Social Ethics


A fascinating paper on the role that markets may play in influencing our social values and shaping our social ethics. Bartling, Björn and Weber, Roberto A. paper "Do Markets Erode Social Responsibility" (November 29, 2013. CESifo Working Paper Series No. 4491. Available at http://ssrn.com/abstract=2363888) "studies the stability of socially responsible behavior in markets".

The authors develop a laboratory 'experimental' approach "in which low-cost production creates a negative externality for third parties' or in other words, the choice of low cost production is associated with imposition of cost on third party. However, the experimental mechanism also includes and alternative production "with higher costs" to the main parties, but which "entirely mitigates the externality". So, in other words, the contracting parties can have a choice:
1) Opt for lower cost technology at a cost to a third party, or
2) A lower higher cost technology that has no additional cost to a third party.

Obviously, choice of (2) implies stronger social values, whilst choice of (1) implies rational optimisation in normal market setting.

"Our data reveal a robust and persistent preference for avoiding negative social impact in the market, reflected both in the composition of product types and in a price premium for socially responsible products. Socially responsible behavior in the market is generally robust to varying market characteristics, such as increased seller competition and limited consumer information. Fair behavior in the market is slightly lower than that measured in comparable individual decisions."

This is really, really interesting. More specifically, the core findings are:

"In our market, competition does drive down overall prices" in other words, it delivers economically efficient outcome, "thus yielding greater relative surplus for consumers at the expense of firms".

However, "there is no detrimental effect of increased competition on the degree of concern exhibited toward externality-bearing parties outside of the market. In fact, the market share of products that yield no externality increases slightly under increased firm competition, relative to our market baseline, as does the price premium for the socially responsible product. Thus, instead of decreasing the expression of social responsibility, increased market competition in this case seems to have, if anything, the opposite effect."

The puzzling bit is why this outcome arises in the setting where the parties know they are facing higher cost by accepting the need for concern for third parties? "One possible interpretation for this finding is that, as competition yields increased surplus for consumers, they become more willing to bear the costs associated with mitigating the externality for third parties." In a sense, greater efficiency funds 'purchases' or 'consumption' of social justice.

And what about giving parties more information to attempt to steer their decisions in the desired (presumably socially) direction?

"…we consider the possibility that consumers may have limited information about the degree of externality produced by available products, but have the ability to learn about such product characteristics. This reflects the fact that many consumers do not know which firms’ products are, for example, environmentally or socially harmful, but that such information is often available if a consumer chooses to acquire it. We study both a case in which the information is free to consumers and one in which acquiring it involves the consumer incurring a small cost. In both cases, we find that the need for consumers to actively acquire product information regarding social impact has only a small effect—though slightly larger when acquiring information is costly—on the expression of social responsibility in the market."

The invisible hand of the markets, it seems, is rather kind to ethical concerns, when the markets reach at least some level of prior efficiency...

2/1/2014: Risk, Regulation, Financial Crises: A Panacea Worse than the Disease?



An interesting - both challenging and revealing - piece on 'preventing the future crisis' via http://www.pionline.com/article/20131223/PRINT/312239993/preventing-the-next-financial-crisis-requires-regulatory-changes.

Few points worth commenting on:

Per article: "…Record investment management industry profits as well as record market highs belie the fact we remain truly exposed to complex financial products and services not yet fully restrained since the crisis of 2008." As a logical conclusion to this, of the "three things in particular should concern all of us who are stakeholders in the finance industry as we move into the new year" the first one is:

"…complacency that another crisis can't happen because we have fixed the gaps in regulation."

So far nothing to argue with. Financial innovation (aka a path of increasing complexity) remains the main source of margins uplift in the industry. As long as that is the case, we are going to have less transparency, lower capacity to price risks and, as the result, greater fragility of the system, especially with respect to tail events.

"Nothing could be further from reality and the list of unfinished regulatory business is long. " And the article rolls on with a brief list of reforms and changes yet to take place. Alas, desired or not, these changes are hardly going to bring about any significant change in the way the sector operates. The irony is: the article warns against complacency and then complacently assumes (or even postulates - take your pick) that implementing the list of regulations and reforms supplied will resolve the problem of 'gaps in regulation'.

Really? Now, wait a second. We have a problem of 2 parts:
Part 1: complexity of system is high.
Part 2: complexity of regulation lagging complexity of system.

Matching Part 1 to Part 2 by raising complexity of regulation can only address the problem of risk buildup if and only if Part 1 is independent of Part 2. Otherwise, rising complexity in 2 can lead to rising complexity in 1 and a race in complexity.

Still with me? That is a major problem of the financial system as we know it since at least 19th century. The problem is that rising complexity of regulation is driving financial innovation probably as much as the need for higher margins. The race to match Part 1 and Part 2 above is a loss-making game for regulators, and thus, for economies at large.

If that is at least partially true, the argument should not be about regulations that are yet to be implemented, but rather about which regulations can help reducing complexity (and increase risk management effectiveness) in both Parts 1 and 2. We are still missing that argument, having departed firmly on the path of reasoning that suggests that higher complexity of regulation = higher system ability to absorb shocks. More dangerously, we are seemingly traveling along the line of logic that suggests that higher complexity of regulation = higher ability of system to 'prevent' shocks.


The article goes on to list another major source of risk: "investment management industry overconfidence that it is back in control". Specifically, "We in the industry perceive ourselves as having rectified our inability to see building counterparty, leverage and liquidity risks, masked through Federal Reserve policy by the unorthodox government support of financial markets and the nearly 10,000-point move in the Dow Jones industrial average since the financial crisis."

In reality, "Systemic risks are still building, undetected. Transparency is not increasing and the unwillingness or inability to remove government support in the markets is unprecedented."

Guess what? If you assume that more regulation + more complex regulation = better risk management, you are going to become complacent and you are going to get a false sense of security, control. This brings us back to the first point above.


And now to the non-point point number 3: "Finally, we in the investment management profession seem totally nonchalant about the current state of our existing regulatory system. It is alarmingly outdated, under-resourced and no match for the complexity of markets in the 21st century. To be clear, we are not talking about the new regulations addressing the crisis, rather the basic requirements of our present regulatory structure."

Back to point one above, then, again…


The reason I am commenting on this article is precisely because it embodies the very poor logical reasoning that is leading us to structure regulatory responses to the crisis in such a way that it will assure the emergence of a new crisis. But the real kicker is not that. The real kicker is that the very belief that regulatory system based on matching complexity of regulated services can ever be calibrated well-enough to assure stability of the system is a belief suffering from gross over-extension of faith.

A constant race to increase complexity of the system will lead to system collapse. 

2/1/2014: Manufacturing PMI for Ireland: December 2013

Manufacturing PMI is out for Ireland today, per Markit/Investec release: "The Irish manufacturing sector ended 2013 on a positive note as growth of output and new orders gained momentum in December. Meanwhile, the current sequence of job creation was extended to seven months. On the price front, input cost inflation picked up slightly while firms raised their output prices for the fourth month running."

Please note: since Markit/Investec no longer release actual numbers for subindices (e.g. employment or orders or export orders, etc), we have to take these claims on faith. For example, the release claims increased export orders from China as one of the drivers of the new business improvement. Yet Irish exports to China are low and it is hard to see how this source of uplift can register as a driver in the overall data, unless the survey participation is severely skewed toward some specific MNCs with remaining significant exposure to exports to China.

Note: Good exports to China from Ireland in January-October 2013 stood at a miserly EUR1.642 billion, down from EUR1.885 billion recorded in the same period of 2012 and representing just 2.26% of our total goods exports in January-October 2013.

Further per release: "The seasonally adjusted Investec Purchasing Managers‟ Index® (PMI®) – an indicator designed to provide a single-figure measure of the health of the manufacturing industry – rose to 53.5 in December from 52.4 in November. This signalled a solid improvement in business conditions, and the seventh in as many months."

The last claim is a matter of interpretation. 1.1 points gain in the PMI reading is the 4th largest in 12 months of 2013 and 7th largest in the last 24 months. However, the index reading in December is the 2nd highest in 2013 and the 3rd highest over the last 2 years, which is, undoubtedly, a good thing.

Two charts and dynamic trends to illustrate headline index changes:



In terms of overall PMI, Manufacturing activity averaged at 51.1 over the last 12 months, so the current reading is above that. However, December reading is below the 3mo average for November-December 2013 which stands at 53.6.

Q1 2013 average PMI for Manufacturing was 50.13, and this fell to 49.33 in Q2 2013, before rising to 51.9 in Q3 2013 and to a healthy 53.6 in Q4 2013.

Overall, we are now into third consecutive month with the PMI for Manufacturing index statistically above 50.0. Another good thing.


Full Markit/Investec release is here: http://www.markiteconomics.com/Survey/PressRelease.mvc/119915a961bd40caa4218d77234245e2

2/1/2014: 'Rip-off Ireland' and Local Authorities' Rents


H/T to @SeamusCoffey for flagging the following chart from the CSO:


Two things of note:

  1. The 'deleveraging' of costs in Ireland (remember the 'competitiveness gains' meme?) is obviously not touching state-controlled rents that remain at the levels compatible to those in early 2008, while private rents index is running around early 2006 levels; and
  2. Since 2011 - when the current Government (led by the 'rip-off Ireland' opponents from the FG) came to power - Local Authority Rents are back on the rising trend.
Here is the same CSO data charted in its full glory and rebased to 100 = average for 2003


  • Actual Rentals (Housing and Mortgage Interest inclusive) down 8.28% in Q4 2013 compared to Q1 2007 average
  • Actual Rents Paid by Tenants are down 2.32%
  • Private Rents are down 6.61%
  • Local Authority Rents are up 25.97%
You know... 'protecting the worst-off' thingy etc, etc, etc...

2/1/2014: Economics of Christmas


This is an unedited version of my Sunday Times column from December 29, 2013.


December is the month that economic forecasters learn to love and to hate.

They love the role the month plays in the annual aggregates for core economic time series. Get December trends right and you are free to bask in the warm glow of having an in-the-money forecast until the first quarter results start trickling into the newsflow.

They learn to hate a number of things that can make Christmas seasons notoriously volatile, especially around the time when economies switch paths from, say, recession to growth. Miss that moment and your forecasts will be out by a mile for a long time to come. Remember 2008-2009 when all analysts were racing against the tide of real data to update their projections downward? One of the reasons for this was that the peak of uncertainty fell on the last quarter. Secondly, Christmas behavior – by both consumers and businesses – is saddled with deep behavioural biases. This does not make holidays’ data fit well with mathematical models.

Ireland is a great case study for all of the above forces interacting with each other to underwrite our economic fortunes. Take the latest statistics, released last week, covering quarterly national accounts through Q3 2013. While this period does not include holidays shopping season, it is revealing of the strange currents in underlying data. Adjusted for inflation, personal consumption fell 1.22 percent in Q1-Q3 2013 and was down 1 percent in Q3 2013 relative to Q3 2012. In other words, household demand continues to underperform overall GDP and GNP in the economy.

This contrasts with continuous gains recorded in consumer confidence, which rose more than 21 percent year on year by the end of Q3 2013. In fact, the two series have been moving in the opposite direction since the mid-2009.

Some of the reasons for this paradoxical situation were revealed in the recent Christmas Spending Survey 2013, released by Deloitte. Despite the positive newsflow from the GDP and GNP aggregates, consumers in Ireland are more concerned with the state of domestic economy than their European counterparts. Overall, the percentage of Europeans who believe their purchasing power has diminished in 2013 compared to 2012 amounts to 41 percent. In Ireland, the figure is 48 percent. Only 26 percent of Irish consumers are expecting their disposable incomes to rise next year. In core spending cohorts comprising the 25-54 year olds, average proportion of population expecting improved incomes over the next year is even lower.

In other words, it seems to matter who asks the question in a survey and it matters what type of question is being asked. A question about confidence asked by an official surveyor yields one type of a reply. A question about actual tangible income expectations asked by a less formal private company surveyor yields a different outcome. These are two classic behavioural biases that wreck havoc with the data.

Despite the gloom, however, Ireland still leads Europe in terms of per capita spending during the Christmas season. Per Deloitte survey we plan to spend around EUR894 per household on gifts, entertainment and food in the last three weeks of December 2013, down from EUR966 reported in surveys a year ago and down from the actual spend of EUR909.

In brief, we are a nation of confident consumers with pessimistic outlook on the present and the future, who are spending less, but still outspend others when it comes to Christmas. A veritable hell of reality for our forecasters.


But what makes December a nightmarish month for those making a living predicting economic trends, makes it so much more exciting for research economists interested in explaining our choices and behaviour. For them, Christmas is when social mythology collides with reality.

Christmas purchases allow us to gauge the consumers’ ability to assess the value of things. In economics terms, the valuations involved are known as willingness to pay and willingness to accept. The former reflects the price we are willing to pay to obtain a pair of the proverbial woolen socks with a Christmas tree and Santa embroidered on them. The latter references the price we are willing to accept in order to give up the said pair of socks after they are passed to us by our kids with a ‘Merry Christmas, Dad!’ cheer.

In numerous studies, our willingness to accept is substantially higher than our willingness to pay – a phenomenon known as the endowment effect.

Christmas shopping data actually tells us that the endowment effect is present across various cultures. The data also tells us that the sentimental or subjective value attached to a gifted good is not a function of price. In other words, spending three times as much on Christmas festivities and gifts as the Dutch do, does not make Irish consumers any merrier.

But spending more has its costs. Some recent surveys indicate that up to one third of all Irish consumers will take on new debt during the Christmas season. In the Netherlands that figure is around one fifth. And long-term indebtedness is a costly proposition when it comes to social, psychological and financial wellbeing.

On the other hand, intangible quality of gifts matters to the consumers both in terms of giving and receiving. As the result, we tend to form expectations of what others value in gifts we give and we also match these expectation with our personal preferences. This induces series of biases and errors into our choices of gifts we purchase.

In Ireland, books represent top preference as a gift for both giving and receiving. In the majority of other countries in Europe, the matched preferences are for giving cash. Before we pat ourselves on the back for being a literature-loving nation, however, give this fact a thought. Giving cash provides a better matching between preferences of gift giver and gift recipient. In basic economics terms, cash gifts eliminate deadweight losses associated with gift giving. This, in turn, means that in countries where cash dominates physical goods giving, smaller expenditures on gifts achieve better outcomes in terms of recipients’ satisfaction. The reason for this is simple: we say we like something as a gift, but we still end up returning or recycling up to 30 percent (based on various studies) of gifts given to us. Why? Because goods are rearely homogeneous, so our preferences for books do not perfectly distinguish which books we like.

Gifts also have a reciprocal value. Christmas surveys have led us to a realization that the power of ‘give to receive’ thinking works well outside the holidays season as well. For example, charitable donations rise robustly when request for donations is accompanied by a forward gift from a charity. In one study, relative frequency of donations to a charity can rise by up to 75 percent when a gift is included with a request.

Still, research in economics overwhelmingly suggests that Christmas behavior by consumers delivers a significant deadweight loss to the economy and consumers-own wellbeing. In other words, our consumption patterns around Christmas can result in misallocation of resources that are not recoverable through the gains in retail sales, services, taxes and other economic activities. Given evidence from other countries, the deadweight loss from Christmas 2013 to the Irish economy can be anywhere in the region of EUR150-450 million.


Beyond economics of gift giving, popular mythology has it that Christmas is also a period of excess, especially when it comes to food and alcohol consumption. On average, this year, Irish consumers are expected to spend EUR259 on food per household. This is well ahead of the European average and reflects not only differences in prices, but also the level of alcohol consumption and our tendency to bundle food purchases with purchases of alcoholic beverages.

Culinary exploits of the festive season are generally subdued in quality and variety of food, but we make up for it with quantity. Marketing research suggests that the guiding principle to a successful Christmas meal is ‘safe, sound and abundant’ traditional dishes, rather than creative and experimental fare. Thus, virtually all cultures celebrating Christmas have a regulation-issued set of traditions designed to combat the festive season’s calories. These range from New Year resolutions (rarely followed through) to periods of fasting and abstinence (often tried, but rarely verified in terms of health virtues they claim to deliver).

One recent study looked at 54 million death certificates issued in the US from 1979 through 2004. The authors found that “there are holiday spikes for most major disease groups and for all demographic groups, except children. In the two weeks starting with Christmas, there is an excess of 42,325 deaths from natural causes above and beyond the normal winter increase.”

Another medical study found evidence of a significant weight gain in the US population during the December holidays. According to the study, the mean weight increased by 370 grams on average per person during the holidays. This weight gain remained intact during the rest of the year. In other words, all the New Year’s resolutions and health club memberships gifts cannot undo the damage done by turkey and gravy.


Last, but not least, popular mythology ascribes to the economists the definition given by Oscar Wild to a cynic: “A man who knows the price of everything and the value of nothing”. But studies of the Christmas data show that for economists, the size of the gap between sentimental value of the gifts and their retail or market prices is lower than for other professions. It seems, the economists know both the price and the value of Christmas gifts better than other consumers. Sadly, that knowledge seems to be of little help when it comes to understanding what is going on with the Irish economy at large.




Box-out:

The latest instalment in the European banking union saga agreed two weeks ago was heralded by the EU leaders as the final assurance that the taxpayers will never again be forced to shore up European banks in a financial crisis. In reality, the final agreement on the structuring of the Single Resolution Mechanism (SRM) is a sad exemplification of the bureaucratic dysfunctionality that is Europe.

In the US, a single entity is responsible for assessing the viability of a bank experiencing an adverse shock and subsequently determining on the action to be taken in resolving the shock. That authority is the Federal Deposit Insurance Corporation or FDIC.

In Europe, based on the latest agreement between the European Finance Ministers, the SRM will involve at least 148 senior officials across eight diverse decision-making bodies. The resolution procedures can involve up to nine, and at least seven different stages of approval. Majority of these stages require either simple or super-majority voting. The whole process is so convoluted, one doubts it can be relied upon to deliver a functional and timely response to any crisis that might impact Euro area banking in the future.

Is it time we renamed the European Banking Union a Byzantium Redux?

1/1/2014: Happy New Year!


Happy New Year to all! May 2014 be a better, kinder, more prosperous year for all!

Thank you all for reading this blog, for citing it in your own articles, and for commenting over 2013. Stay tuned for more in 2014!

Tuesday, December 31, 2013

31/12/2013: Debt and Growth: Consumption Crowding-Out Channel


Since the overhyped and outright hysterical 'controversy' over the Reinhart & Rogoff debt thesis blew up across the media earlier this year (I covered much of the controversy on the blog and in my columns, for example, here http://trueeconomics.blogspot.ie/2013/07/272013-village-june-2013-real-effects.html), it became - to put it mildly - unfashionable to reference the adverse effects of debt on growth and economy. Too bad, some economists seem to have missed that point.

A new study from the Korea Institute for International Economic Policy, titled "Nonlinear Effects of Government Debt on Private Consumption in OECD Countries" (see citation below) looked at "nonlinear effects of government debt on private consumption in 16 OECD countries. The estimated consumption function shows smooth regime switching depending on the debt-to-GDP ratio, and the threshold level of regime switching is found to be the ratio of 83.7 percent. The results reveal that a higher level of government debt crowds out private consumption to a greater extent, and that the degree of the crowding out effect has deteriorated since the global financial crisis."

Wait, there are thresholds here… 83.7% debt/GDP ratio - very close to the  S. Cecchetti, M. Mohanty and F. Zampolli thresholds (see http://trueeconomics.blogspot.ie/2011/09/26092011-irelands-debt-overhang.html). And there is the 'causal link' between debt and growth via crowding out of private consumption.

31/12/2013: Negative equity and entrepreneurship: new evidence

Since the beginning of the crisis, I have written about and presented on the topic of negative equity and its adverse effects on economy and society.

Some of the earlier links on this topic can be found here:
http://trueeconomics.blogspot.ie/2010/06/15062010-negative-equity-1.html
http://trueeconomics.blogspot.ie/2010/06/economics-15062010-negative-equity-2.html
http://trueeconomics.blogspot.ie/2010/06/economics-15062010-negative-equity-3.html

One significant adverse effect of negative equity relates to the impact it has (via investment constraints) on entrepreneurship: http://trueeconomics.blogspot.ie/2010/01/economics-15012010-negative-equity.html

This month, NBER published yet another study on the above topic, covering the issue of property values impact on collateral availability for entrepreneurial activities.

The study, "Housing Collateral and Entrepreneurship" (NBER Working Paper No. w19680) by Martin Schmalz, David Alexandre Spaer and David Thesmar "shows that collateral constraints restrict entrepreneurial activity. Our empirical strategy uses variations in local house prices as shocks to the value of collateral available to individuals owning a house and controls for local demand shocks by comparing entrepreneurial activity of homeowners and renters operating in the same region. We find that an increase in collateral value leads to a higher probability of becoming an entrepreneur."

What is novel to the study results and is also extremely important from economic policy point of view is that "Conditional on entry, entrepreneurs with access to more valuable collateral create larger firms and more value added, and are more likely to survive, even in the long run."

Now, keep in mind - Ireland's politicians and both the previous and current Government officials have been consistently claiming that negative equity only matters when households need to move from their current location to a new residence. In contrast, I have asserted from the start of the crisis that the adverse effects of negative equity are present not only in the context of households moving locations, but also for the households that are staying in their current location and that some of the effects are completely independent from the ability of the households to fund their current mortgages.

Link to the study: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2360948

Sunday, December 29, 2013

29/12/2013: WLASze: Weekend Links on Arts, Sciences and zero economics


This is the last 2013 WLASze: Weekend Links on Arts, Sciences and zero economics.


Last WLASze touched upon the festive season, quoting from Joseph Brodsky
"Emptiness. But the mere thought of that
brings forth lights as if out of nowhere.
Herod reigns but the stronger he is,
the more sure, the more certain the wonder."

Here's a retrospective reminder, incomplete and perhaps not multi-faceted enough, but still poignant, of that Emptiness and Herod interplay in our lives at the brutalist Berlin Wall:
http://life.time.com/history/berlin-wall-photos-from-the-early-days-of-a-brutal-cold-war-symbol/?iid=lf%7Cmostpop



Returning back to year-end themes of recalling 2013 before it fades away some 51 hours from now:
http://www.businessinsider.com/sciences-2013-breakthroughs-of-the-year-2013-12
Two of my favourite discoveries of 2013 are:
1) Use of structural biology to generate a new vaccine against respiratory syncytial virus (RSV), and
2) Discovery of the evidence that "at least some cosmic rays come from exploding stars"


And on the theme of fading memories and scientific breakthroughs - here's one that ties the two together neatly...
http://online.wsj.com/news/articles/SB10001424052702304866904579270390834135678?mod=trending_now_2

As I suggested in relation to some other discoveries, this one will challenge more our ethics than our scientific minds...


But being one Dr Doom, I can't escape a 'bad news' story on science's front… well, sort-of-bad:
http://en.ria.ru/science/20131227/185954381/Russian-Anti-Gravity-Observation-Satellite-Delayed-Until-2015.html
One satellite delay is not enough? How about a delay with a Space Lab?
http://en.ria.ru/russia/20131127/185078995/Russia-Postpones-Space-Lab-Launch-Again.html
At least Greenpeace won't need to protest in 'Russian' space...


From bad, to good: "The Desire for Freedom. Art in Europe since 1945" is a new exhibition at Museum of Contemporary Art Krakow that "explores the socio-political undercurrents of European art since 1945 through to the present day."
http://en.mocak.pl/the-desire-for-freedom


You can (and should) always rely on art to lift the spirits that science occasionally dents... though French art rarely does this nowadays...


I have been critical before about architectural (and commercial) exploits of natural space for a quick gratification of senses (and cash). Here is a counter-point:
http://wordlesstech.com/2013/12/26/step-void-alps/
Perhaps it is an anchoring bias in me (I love mountains more than any other place on earth) or the aesthetic desire for air and space, but I love this observation 'room' concept and execution.




And while on WorldlessTech page, here's another fantastic project - merging visual power of art to bring down the aesthetic refuge of poetry closer to people:
http://wordlesstech.com/2013/12/07/opiemmes-journey-painting-poetry/
As Robert Lowell put it:
"The painter’s vision is not a lens,
it trembles to caress the light."

Or why not in full glory?

***
Epilogue
BY ROBERT LOWELL
Those blessèd structures, plot and rhyme—
why are they no help to me now
I want to make
something imagined, not recalled?
I hear the noise of my own voice:
The painter’s vision is not a lens,
it trembles to caress the light.
But sometimes everything I write  
with the threadbare art of my eye
seems a snapshot,
lurid, rapid, garish, grouped,
heightened from life,
yet paralyzed by fact.
All’s misalliance.
Yet why not say what happened?
Pray for the grace of accuracy
Vermeer gave to the sun’s illumination
stealing like the tide across a map
to his girl solid with yearning.
We are poor passing facts,
warned by that to give
each figure in the photograph
his living name.
***


Reminds you of Russian Constructivists' efforts to achieve the same, except for the purpose of delivering an ethical message, not an aesthetic one…



Great retrospective of 2013 Year Review from Design-Milk: http://design-milk.com/2013-year-review-unframed/


One of the best photographers to come out of Ireland - superb Paul Gaffney - reviewed in the British Journal of Photography back in November: http://www.bjp-online.com/2013/11/we-make-the-path-by-walking-by-paul-gaffney-book-review/


Enormity of life abandoned by concrete of the road above… fragility of rebirth and power of determination? Artist's page here: http://www.paulgaffneyphotography.com/


And the Book I want this New Year is…

Xu Bing, Book From the Ground: Point to Point, Guangxi Normal University Press, 112pp
More on it here: http://languagelog.ldc.upenn.edu/nll/?p=4353 This is a book that promises to defy all conventions of language to reinforce the convention of semiotics (or proto-language, if you want)… it is an unconventional tome which features no words. Instead, book's content is formally derived from symbols, marks, doodles, etc. The narrative tells the story of “Mr Black” who is supposedly "a white-collar worker living in a modern metropolis". This is an attempt to bring communications outside the confines of language and I want to see if it delivers on the promise…


Alas, I suspect that by 'defying all conventions' of writing, it in a way returns us back to the fact that evolved written languages are alive today for a good reason... perhaps they need translation or learning, perhaps they are cumbersome in that, yet they do function to deliver the meaning, right? Try writing WLASze in something that looks like the above?..


Happy New Year to all! 

Remember what Auden said about Poetry in his New Year Letter?
“Poetry might be defined as the clear expression of mixed feelings.”
May we have both in 2014, but more of the former, whilst in the latter more of the better...

29/12/2013: Icelandic Model for Debt Crises Resolution?


A very comprehensive paper analysing the Icelandic approach to personal debt and corporate insolvency crises resolution:
http://hhi.hi.is/sites/hhi.hi.is/files/W-series/2013/WP1310.pdf

Latest comparatives between Icelandic and Irish economic performance: http://trueeconomics.blogspot.ie/2013/10/27102013-ireland-v-iceland-full-deck.html


Saturday, December 28, 2013

28/12/2013: CIS Free Trade Zone Expands


Uzbekistan officially joined the CIS Free Trade Zone, which now includes:

  • Armenia
  • Belarus
  • Kazakhstan
  • Moldova
  • Russia
  • Ukraine
  • Uzbekistan
These cover 3.95% of total world GDP (adjusting for Purchasing Power Parity).

News post on the above here: http://en.ria.ru/business/20131228/186017027/Uzbekistan-Joins-CIS-Free-Trade-Zone.html

Kyrgyzstan and Tajikistan are signatories, but are yet to ratify the treaty (0.04% of world GDP (PPP-adjusted).

For comparative: Germany accounts for 3.72% of world GDP (PPP-adjusted), Italy and Spain jointly account for 3.68%.