May 13, 2011

Omnivore's Dilemma - Introduction Notes


Introduction - National Eating Disorder

“Many people today seem perfectly content eating at the end of an industrial food chain, without a thought in the world; this book is probably not for them.”

In American culture, inherited cultural knowledge about eating has been replaced by confusion & anxiety.  This important activity now requires remarkable amount of expert help.  Lipophobia in 1970’s has morphed into Carbophobia in 2000’s, causing bread & pasta, a staple of dining tables, to be replaced with imperfect substitutes.  This was caused by media storm of diet books, studies, and magazine articles (including the formerly discredited Dr. Atkins).  Such a violent change in a culture’s eating habits, unseen in other countries in Europe & Asia, is the sign of a national eating disorder - other signs include dietary goals in the shape of a pyramid set by government legislation, endless stream of diet books (every January), confusion of dietary supplements for meals, obsession with fast food, and gross obesity.  Americans are dismayed at the fitness of other countries, despite what appears to be lavish consumption.  Others are amazed that Americans are so confused about what to eat.

Omnivore’s dilemma was first mentioned by Rousseau and Brillat-Savarin, addressing the boon and burden of being able to eat with greater freedom (and risk).  Some anthropologists believe our brains evolved in order to better address omnivore’s dilemma.  In addition to our senses, culture memory serves important function in distinction between good & bad foods - stores accumulated wisdom of countless human experiences.  Culture acts to avoid dilemma at the onset of every meal.  Part of American problem stems from plethora of choices available at local markets (Note - America is unique in this aspect; most cultures only have access to locally grown fruits & vegetables).  America also suffers from heterogenous culture.  Lack of steadying culture of food leaves us susceptible to some profiteers and marketers, who view omnivore’s dilemma as an opportunity.  It is in food industry’s interests to exacerbate our anxieties regarding diet, to better assuage us with new products.

Purpose of this book is to trace the origin of meals in order to discover the most fundamental relationships between species in nature, vis a vis eaters & eaten.  It focuses on three separate food chains that sustain us:  1) industrial, 2) organic, and 3) hunter-gatherer.  

Ecology also tells us that all life in on earth is a competition for energy, specifically solar energy (Note: Living Within Limits - Garrett Hardin).  Industrial revolution of food chain has changed fundamental rules of the game.  Reliance on sun has been replaced with reliance on petrol-fuels.  This has greatly increased the among of food energy available.  Abundance seems to have deepened the Dilemma, not render it obsolete.

The end result is the discovery of the Perfect Meal, not because of its taste, but because of the labor and thought-intensive process, enjoyed in the company of other foragers.  It provides the rare opportunity to eat in full consciousness of everything involved in the food we eat - it involves paying the full karmic price of a meal.  Industrial eating removes us from the relationship we have with nature’s other inhabitants - we often disregard not only the animal’s pain, but our pleasure.

The book will also illustrate the tension between nature and human industry.  Often, our prodigiousness comes into conflict with nature’s ways, particularly when we try to maximize efficiency (vast monocultures, fossil fuels, artificial animal farms, novel diets).

“But in the end this is a book about the pleasures of eating, the kinds of pleasure that are only deepened by knowing.”

Apr 11, 2011

Crawford & Company CRD-A/B Arbitrage

The stock market is one of the few places where two nearly identical goods are bought and sold for vastly different prices.  Consider the example of Crawford & Company, an insurance services provider based in Atlanta, GA.

Crawford has two classes of stock, Class A (CRD.A) and Class B (CRD.B).  The two classes share identical economic interests and similar liquidity profiles.  However, the Class A shares have no voting rights, while the Class B shares have votes, and thereby should command a premium.  How much of a premium?  According to currently quoted prices, B shares are currently 43% more expensive than A shares ($4.60 vs $3.20)!!

The biggest risk for potential arbitrageurs are

  1. the possibility of this price discrepancy further expanding 
  2. the timeliness of the convergence.

As the below graph shows, the current B-share premium of 43% is high by historical standards.  However, the premium exploded during the financial crisis - the possibility of Risk 1 clearly rises during periods of acute financial distress.  Interestingly, the spread pre-crisis ranged from 0-20%, while post-crisis, the spread has shifted upwards to a new range of 20-40%.

Mar 14, 2011

Only in America...

Mammon demands sacrifice I guess... no more commentary necessary

http://www.liveleak.com/view?i=696_1300116168

Mar 7, 2011

Problem: High Oil Prices... Solution: Print More Money!?!?!?

Using logic that can only be described as "asinine", one of the most influential economists in the country, and a member of the Federal Reserve, has just declared that the solution to dangerously high commodity prices is to flood the market with more paper currency...

"If [the rising price of oil] plays through to the broad economy in a way that portends a recession, I would take a position we would respond with more accommodation," Lockhart said at the conference.

Very interesting Mr. Lockhart.  So you believe that in a deflationary environment, the proper response is quantitative easing... and you also believe that in a inflationary environment, the proper response is, yet more, quantitative easing... certainly, no one can accuse of you overly-complex thinking.

It is good that educational institutions no longer teach such quaint ideas as the direct positive correlation between money supply and commodity prices.  Otherwise, the Federal Reserve would be leading us down the exact opposite of the correct path.  It is good...

Maybe after they are violently removed from office by the impoverished lynching mob of lower/middle class, the surviving members of the Federal Reserve could find second careers in carpentry.

Feb 17, 2011

Article - Is Wealth Gap Widening Under Obamananke? (yes!)

Article is sorta fluffy, but it conveniently sums up many of the arguments against the policies we are currently engaged in...
Consumer sentiment among families with income above $75,000 jumped to 88.2 in early February, the highest since under President Bush in 2007, according to the Reuters/University of Michigan's latest survey. 
But sentiment among lower-income households dropped to 67.7 from 72.1 in January, trapped in a range it's been stuck in since just after Obama's 2009 inauguration. 
The president helped widen this gap by compromising on the Bush tax cuts with the Republicans in Congress, agreeing at the end of last year to extend them on all incomes for two years, investors said. 
Meanwhile, Fed Chairman Ben Bernanke has set upon a large quantitative easing program that has boosted the stock market by increasing liquidity, but also raised the costs of basic goods that hit the poor the very hardest.

Feb 16, 2011

Poverty 1 - Middle Class 0

'Better late than never' - that's what I suspect the motto of mainstream media is.  Oh well.  Here's today's soundbite...
Are you better off than your parents? 
Probably not if you're in the middle class. 
Incomes for 90% of Americans have been stuck in neutral, and it's not just because of the Great Recession. Middle-class incomes have been stagnant for at least a generation, while the wealthiest tier has surged ahead at lighting speed. 
In 1988, the income of an average American taxpayer was $33,400, adjusted for inflation. Fast forward 20 years, and not much had changed: The average income was still just $33,000 in 2008, according to IRS data. 
Meanwhile, the richest 1% of Americans -- those making $380,000 or more -- have seen their incomes grow 33% over the last 20 years, leaving average Americans in the dust. Experts point to some of the usual suspects -- like technology and globalization -- to explain the widening gap between the haves and have-nots 
And public policy of the past few decades has only encouraged the trend. 
The 1980s was a period of anti-regulation, presided over by President Reagan, who loosened rules governing banks and thrifts. 
A major game changer came during the Clinton era, when barriers between commercial and investment banks, enacted during the post-Depression era, were removed. 
In 2000, President Bush also weakened the government's oversight of complex securities, allowing financial innovations to take off, creating unprecedented amounts of wealth both for the overall economy, and for those directly involved in the financial sector. 
Tax cuts enacted during the Bush administration and extended under Obama were also a major windfall for the nation's richest. 
And as then-Federal Reserve chairman Alan Greenspan brought interest rates down to new lows during the decade, the housing market experienced explosive growth. 
"We were all drinking the Kool-aid, Greenspan was tending bar, Bernanke and the academic establishment were supplying the liquor," Deutsche Bank managing director Ajay Kapur wrote in a research report in 2009. 
But the story didn't end well. Eventually, it all came crashing down, resulting in the worst economic slump since the Great Depression. 
With the unemployment rate still excessively high and the real estate market showing few signs of rebounding, the American middle class is still reeling from the effects of the Great Recession.
Meanwhile, as corporate profits come roaring back and the stock market charges ahead, the wealthiest people continue to eclipse their middle-class counterparts. 
"I think it's a terrible dilemma, because what we're obviously heading toward is some kind of class warfare," Johnson said.
(emphasis added)