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Julio Huato | 1 May 2007 01:51
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Fwd: again, differential games

Michael Lebowitz asked me to forward this to PEN-L.

---------- Forwarded message ----------
From: michael lebowitz <mlebowit@...>
Date: Apr 29, 2007 11:46 PM
Subject: again, differential games
To: Julio Huato <juliohuato@...>

Hi Julio,
    Just a short note to you. I can't post to PEN from this account
(which I use when I'm travelling and with my baby laptop computer)
anyway.
     My point was not at all Ted's. Ie., I'm not all ruling out
self-oriented folks in continuing games coming to the decision to be
generous, not to defect, etc.What I was questioning was your inference
that the dominant theory is based upon the assumption of altruism---
and seemingly because of the recognition that the theory would
collapse otherwise. I don't see any signs of this [and hoped you could
point some to me]; rather, I think there may be acceptance in some
quarters that continuing games tend to generate cooperation [but
that's a far cry from altruism].
       best,
       michael
ps. we are relaxing--- working, to be sure, but at human paces.
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Julio Huato | 1 May 2007 01:51
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Fwd: again, differential games

My reply.

* * *

Hi Michael,

Should I then forward this to PEN-L?

>      My point was not at all Ted's. Ie., I'm not all ruling out
> self-oriented folks in continuing games coming to the decision to be
> generous, not to defect, etc.

I see.  Then I misunderstood your question.

> What I was questioning was your inference that
> the dominant theory is based upon the assumption of altruism--- and
> seemingly because of the recognition that the theory would collapse
> otherwise. I don't see any signs of this [and hoped you could point some to
> me]; rather, I think there may be acceptance in some quarters that
> continuing games tend to generate cooperation [but that's a far cry from
> altruism].

Okay.  Let me put it in different terms.  The dominant theory requires
legal and political conditions (private ownership laws, contract
enforcement).  If it doesn't assume them, then it must explain them.
If it's to explain them, then it can only do so by introducing them
via preferences or -- as I try to do in my model -- through endowments
and technology.  If it's going to explain them via preferences, then
it requires some version of altruistic preferences, where "altruistic"
means that the individual utility functions have to be interdependent.
(Continue reading)

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Michael Perelman | 1 May 2007 02:01
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Re: Fwd: again, differential games

yes.

On Mon, Apr 30, 2007 at 07:51:54PM -0400, Julio Huato wrote:
> My reply.
> 
> * * *
> 
> Hi Michael,
> 
> Should I then forward this to PEN-L?
> 
> >      My point was not at all Ted's. Ie., I'm not all ruling out
> > self-oriented folks in continuing games coming to the decision to be
> > generous, not to defect, etc.
> 
> I see.  Then I misunderstood your question.
> 
> > What I was questioning was your inference that
> > the dominant theory is based upon the assumption of altruism--- and
> > seemingly because of the recognition that the theory would collapse
> > otherwise. I don't see any signs of this [and hoped you could point some to
> > me]; rather, I think there may be acceptance in some quarters that
> > continuing games tend to generate cooperation [but that's a far cry from
> > altruism].
> 
> Okay.  Let me put it in different terms.  The dominant theory requires
> legal and political conditions (private ownership laws, contract
> enforcement).  If it doesn't assume them, then it must explain them.
> If it's to explain them, then it can only do so by introducing them
> via preferences or -- as I try to do in my model -- through endowments
(Continue reading)

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Michael Perelman | 1 May 2007 03:49
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The Wall Street Journal Worries About Excessive Leverage

The paper offers a perspective on the buildup of wild speculation with little
potential for governmental regulation -- a recipe for disaster.
Smith, Randall and Susan Pulliam. 2007. "As Funds Leverage Up, Fears of Reckoning
Rise." Wall Street Journal (30 April): p. A 1
"Estimates by analysts of leverage at major securities firms, borrowing by hedge
funds and margin loans to individuals added up to $4.9 trillion in 2006, compared
with $1.8 trillion in 2002.  Hedge-fund borrowing and other financing tools were
valued at $1.46 trillion last year, up from $177 billion in 2002, according to
estimates by Bridgewater Associates Inc., a Westport, Conn., hedge-fund company."
"Private-equity firms, investment funds that often buy entire companies, also are
contributing to the leverage buildup.  Loans to companies bought by private-equity
firms rose to $317.3 billion in 2006 from $51.5 billion in 2002, according to
Reuters Loan Pricing Corp.  That's partly a function of more and bigger deals.  But
borrowing has also risen relative to cash generated by companies the funds buy."
"Individual investors have been moving in the same direction.  Their margin debt --
the amount they borrowed from brokerage firms to buy stocks -- totaled $293.2
billion in March, the third straight month it exceeded the record set during the
high-tech bubble in 2000, according to the New York Stock Exchange.  That's up from
$134.58 billion in 2002."
"There's leverage everywhere -- whether at corporations or broker dealers or hedge
funds or private-equity funds," says senior credit analyst Tanya Azarchs, who
follows U.S. banks and brokers at Standard & Poor's Corp. "It sort of feels like
something's got to give."
"In 2006, the Federal Reserve estimated there was $20.6 trillion worth of corporate
stock outstanding, up 73% from 2002."
"Suppose a hedge fund wants to bet that IBM stock will rise.  Under the SEC rule
governing margin lending, the fund couldn't borrow more than $50 for every $100 of
IBM stock it buys.  A "total-return swap" on $100 of IBM shares would cost $5 or
less for many hedge funds, at least initially.  If IBM shares were to rise, the
return per invested dollar would be better than if the hedge fund bought the IBM
(Continue reading)

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Michael Perelman | 1 May 2007 03:54
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Larry Summers Slams Carbon Trading then Supports Imperial Powers

Summers, Lawrence. 2007. "We Need To Bring Climate Idealism Down To Earth."
Financial Times (30 April): p. 13.
"There is a very real danger that the global cap and trade approach directed at
achieving the rapid emissions reductions enshrined in the Kyoto protocol -- now
favoured by most European governments -- could be ineffective or even
counterpoductive by substituting for more realistic approaches to the problem.
Kyoto is now the only game in town for those who do not want to be ostriches with
respect to global climate change and so one has to hope for its ultimate success.
But it is surely useful to try to be clear about the potential pitfalls, as I am in
this column, and as a matter of prudence to consider alternative approaches if the
Kyoto approach does not succeed."
"First, the Kyoto approach depends on the questionable premise that nations will, in
fact, be bound by binding targets or penalties for not meeting them. It is
instructive in this regard to consider the history of the Maastricht Treaty within
the European Union. It addressed fiscal targets directly under the control of
governments over the relatively short term within a group of countries that had
already achieved a high degree of cohesion. It broke down almost immediately when it
looked like the targets would not be binding for big countries, with the goals
abandoned and no payment of even the modest penalties."
"Second, carbon markets are invitations to engage in pork-barrel corporate subsidy
politics on a massive scale. If greenhouse gas emissions are to be substantially
reduced, the value of the associated emissions rights will be in the tens of
billions of dollars. While in principle emission permits could be auctioned, in
practice they are always allocated administratively. It should not be surprising
that businesses that can pass on carbon costs to their consumers are excited about
schemes that compensate for these costs by allocating them permits related to their
existing emissions levels. As investigations by this newspaper have highlighted, the
clean development mechanism has resulted in substantial payments for emissions
reductions that would have occurred anyway or could have been achieved at negligible
cost. There is even reason to think that certain industrial gas emissions may have
(Continue reading)

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Ted Winslow | 1 May 2007 03:56
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Re: Fwd: again, differential games

Michael Lebowitz wrote:

> My point was not at all Ted's. Ie., I'm not all ruling out
> self-oriented folks in continuing games coming to the decision to be
> generous, not to defect, etc.

My point wasn't internal to game theory.  It was that Marx's  
foundational ideas, including his idea of "rationality," can't be  
translated into those of game theory.

Marx, as does the whole tradition of which he's part, assumes that  
"desire" - "preferences" - can be more or less rational i.e. more or  
less consistent with what is objectively "good."  This is an  
appropriation (a "sublation") of Aristotle, partly directly and  
partly through Hegel.

"What affirmation and negation are in thinking, pursuit and avoidance  
are in desire; so that since moral virtue is a state of character  
concerned with choice, and choice is deliberate desire, therefore  
both the reasoning must be true and the desire right, if the choice  
is to be good, and the latter must pursue just what the former  
asserts. Now this kind of intellect and of truth is practical; of the  
intellect which is contemplative, not practical nor productive, the  
good and the bad state are truth and falsity respectively (for this  
is the work of everything intellectual); while of the part which is  
practical and intellectual the good state is truth in agreement with  
right desire.
        "The origin of action -- its efficient, not its final cause -- is  
choice, and that of choice is desire and reasoning with a view to an  
end. This is why choice cannot exist either without reason and
(Continue reading)

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Leigh Meyers | 1 May 2007 06:10
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Re: The Wall Street Journal Worries About Excessive Leverage

If the Wall Street Journal is worried about it, that means it's too
late... right?

Are they a lagging or leading indicator of finance industry disaster?

Leigh
[giggle]

On 4/30/07, Michael Perelman <michael@...> wrote:
> The paper offers a perspective on the buildup of wild speculation with little
> potential for governmental regulation -- a recipe for disaster.
> Smith, Randall and Susan Pulliam. 2007. "As Funds Leverage Up, Fears of Reckoning
> Rise." Wall Street Journal (30 April): p. A 1
> "Estimates by analysts of leverage at major securities firms, borrowing by hedge
> funds and margin loans to individuals added up to $4.9 trillion in 2006, compared
> with $1.8 trillion in 2002.  Hedge-fund borrowing and other financing tools were
> valued at $1.46 trillion last year, up from $177 billion in 2002, according to
> estimates by Bridgewater Associates Inc., a Westport, Conn., hedge-fund company."
> "Private-equity firms, investment funds that often buy entire companies, also are
> contributing to the leverage buildup.  Loans to companies bought by private-equity
> firms rose to $317.3 billion in 2006 from $51.5 billion in 2002, according to
> Reuters Loan Pricing Corp.  That's partly a function of more and bigger deals.  But
> borrowing has also risen relative to cash generated by companies the funds buy."
> "Individual investors have been moving in the same direction.  Their margin debt --
> the amount they borrowed from brokerage firms to buy stocks -- totaled $293.2
> billion in March, the third straight month it exceeded the record set during the
> high-tech bubble in 2000, according to the New York Stock Exchange.  That's up from
> $134.58 billion in 2002."
> "There's leverage everywhere -- whether at corporations or broker dealers or hedge
> funds or private-equity funds," says senior credit analyst Tanya Azarchs, who
(Continue reading)

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Yoshie Furuhashi | 1 May 2007 06:42
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Kerem Kaya and Sinan Ikinci on Turkey

Surprisingly sensible for WSWS (if you can ignore typical WSWS
formulae at the end). -- Yoshie

<http://www.wsws.org/articles/2007/apr2007/turk-a16.shtml>
Political tensions increase as Turkish presidential elections approach
By Kerem Kaya and Sinan Ikinci
16 April 2007

As presidential elections approach, Turkey's political tensions are
continuing to intensify both domestically, between the Kemalist
establishment and the moderate Islamist Justice and Development Party
(AKP) government, as well as internationally, between the Turkish
establishment and the Iraqi Kurds.

The Turkish military is decisively leading both campaigns with support
from the "unarmed forces," a euphemism invented to describe supporters
of the military within influential business and political circles. The
principal protagonists of these forces are Deniz Baykal of Republican
People's Party (CHP), the main opposition leader, and the outgoing
president Ahmet Necdet Sezer. It also includes the Kemalist Thought
Association (ADD) and the Association for Supporting Modern Life
(CYDD), which are both by-products of the events of February 28, 1997,
when the military intervened to oust a coalition government led by the
Islamic-based Welfare Party.

The head of ADD, Sener Eruygur, is a former general. Democratic Left
Party (DSP), and the Social Democrat People's Party (SHP) also
supported a march organized by the "unarmed forces" late last year.
CHP has long been acting as the civilian spokesman of the Turkish
military. In short, all the social democratic or "left-wing Kemalist"
(Continue reading)

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raghu | 1 May 2007 07:50
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Re: Kerem Kaya and Sinan Ikinci on Turkey

On 4/30/07, Yoshie Furuhashi <critical.montages@...> wrote:
> Surprisingly sensible for WSWS (if you can ignore typical WSWS
> formulae at the end). -- Yoshie

Just curious: what do you have against the WSWS?
-raghu.
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Yoshie Furuhashi | 1 May 2007 08:04
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Re: Kerem Kaya and Sinan Ikinci on Turkey

On 5/1/07, raghu <mraghu01@...> wrote:
> On 4/30/07, Yoshie Furuhashi <critical.montages@...> wrote:
> > Surprisingly sensible for WSWS (if you can ignore typical WSWS
> > formulae at the end). -- Yoshie
>
> Just curious: what do you have against the WSWS?

WSWS can't resist inserting into every single article cliches like
"the betrayal of Stalinism and collapse of bourgeois nationalism" that
really explain nothing.  And the conclusion of every single article is
in effect abstention, though it sometimes comes wrapped up in an
exhortation for workers to build a working-class socialist party
independent of the ruling class.  It's true that sometimes abstention
is all you can manage, but if that's all there is to it, what's the
point of politics?
--
Yoshie
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