Any link?
Here is ownership as of February 2007 by state/MSA and here are gasoline taxes as of January 2007. API numbers may be more relevant as it combines local, state and federal taxes.
I don't see any correlation using the eyeball metric.
Sunday, December 19, 2010
First snow and why I hate the Prius
Washington DC saw its first snow this winter last week on Thursday Dec 16th. As expected the Prius handled it badly. I first noticed the prblem the week after I bought the car last year when I was going over bumps and usually manhole covers. Now I find that it is not as isolated as I thought:
From a discussion:
It's a known condition that if you go over a bump violent enough to take a wheel off the road, it will trigger the traction control. That will delay application of the brakes. Several owners have reported this. It can happen on bumps you wouldn't think were that bad.
And whole pages devoted to this traction control problem.
Bottom line: I'll never buy a Toyota, much less a Prius. This fact that Toyota refuses to correct this problem is perhaps indicative that is become too American? My next car might be a Ford, which is an American company that has become more international.
From a discussion:
It's a known condition that if you go over a bump violent enough to take a wheel off the road, it will trigger the traction control. That will delay application of the brakes. Several owners have reported this. It can happen on bumps you wouldn't think were that bad.
And whole pages devoted to this traction control problem.
Bottom line: I'll never buy a Toyota, much less a Prius. This fact that Toyota refuses to correct this problem is perhaps indicative that is become too American? My next car might be a Ford, which is an American company that has become more international.
We begin to sow the seeds for the next financial crisis
1. Revolving doors in the White House-Treasury-Wall Street complex:
LAST July Peter Orszag stepped down from his post as the head of the Office of Management and Budget. As budget director, Mr Orzsag helped shape the first stimulus package and, more visibly, the health-care reform legislation. Apparently, the market values this sort of experience. Last week, Mr Orszag accepted a senior position at the investment-banking arm of Citigroup, an institution that exists in its present form thanks to massive infusions of taxpayer cash. Exactly how much Citigroup pay Mr Orszag is not public knowledge, but swapping tweed for sharkskin should leave him sitting pretty. Bankers who spoke to the New York Times ballparked his yearly salary at $2-3m.
James Fallows rightly observes that not only is the revolving door between Washington and Wall Street unseemly, its frictionless gliding action suggests corruption is built right into the interface between our government and our great profit-seeking institutions. Mr Fallows hesitates to impugn Mr Orszag's personal character. Who can blame a fella for throwing open the door when extravagent opportunity knocks?!
But in the grander scheme, his move illustrates something that is just wrong. The idea that someone would help plan, advocate, and carry out an economic policy that played such a crucial role in the survival of a financial institution—and then, less than two years after his Administration took office, would take a job that (a) exemplifies the growing disparities the Administration says it's trying to correct and (b) unavoidably will call on knowledge and contacts Orszag developed while in recent public service—this says something bad about what is taken for granted in American public life.
When we notice similar patterns in other countries—for instance, how many offspring and in-laws of senior Chinese Communist officials have become very, very rich—we are quick to draw conclusions about structural injustices. Americans may not "notice" Orszag-like migrations, in the sense of devoting big news coverage to them. But these stories pile up in the background to create a broad American sense that politics is rigged, and opportunity too.
2. NYT:
On the third Wednesday of every month, the nine members of an elite Wall Street society gather in Midtown Manhattan.
The men share a common goal: to protect the interests of big banks in the vast market for derivatives, one of the most profitable — and controversial — fields in finance. They also share a common secret: The details of their meetings, even their identities, have been strictly confidential.
Drawn from giants like JPMorgan Chase, Goldman Sachs and Morgan Stanley, the bankers form a powerful committee that helps oversee trading in derivatives, instruments which, like insurance, are used to hedge risk.
In theory, this group exists to safeguard the integrity of the multitrillion-dollar market. In practice, it also defends the dominance of the big banks.
The banks in this group, which is affiliated with a new derivatives clearinghouse, have fought to block other banks from entering the market, and they are also trying to thwart efforts to make full information on prices and fees freely available.
A previous post on ICE is here. It referenced this article
LAST July Peter Orszag stepped down from his post as the head of the Office of Management and Budget. As budget director, Mr Orzsag helped shape the first stimulus package and, more visibly, the health-care reform legislation. Apparently, the market values this sort of experience. Last week, Mr Orszag accepted a senior position at the investment-banking arm of Citigroup, an institution that exists in its present form thanks to massive infusions of taxpayer cash. Exactly how much Citigroup pay Mr Orszag is not public knowledge, but swapping tweed for sharkskin should leave him sitting pretty. Bankers who spoke to the New York Times ballparked his yearly salary at $2-3m.
James Fallows rightly observes that not only is the revolving door between Washington and Wall Street unseemly, its frictionless gliding action suggests corruption is built right into the interface between our government and our great profit-seeking institutions. Mr Fallows hesitates to impugn Mr Orszag's personal character. Who can blame a fella for throwing open the door when extravagent opportunity knocks?!
But in the grander scheme, his move illustrates something that is just wrong. The idea that someone would help plan, advocate, and carry out an economic policy that played such a crucial role in the survival of a financial institution—and then, less than two years after his Administration took office, would take a job that (a) exemplifies the growing disparities the Administration says it's trying to correct and (b) unavoidably will call on knowledge and contacts Orszag developed while in recent public service—this says something bad about what is taken for granted in American public life.
When we notice similar patterns in other countries—for instance, how many offspring and in-laws of senior Chinese Communist officials have become very, very rich—we are quick to draw conclusions about structural injustices. Americans may not "notice" Orszag-like migrations, in the sense of devoting big news coverage to them. But these stories pile up in the background to create a broad American sense that politics is rigged, and opportunity too.
2. NYT:
On the third Wednesday of every month, the nine members of an elite Wall Street society gather in Midtown Manhattan.
The men share a common goal: to protect the interests of big banks in the vast market for derivatives, one of the most profitable — and controversial — fields in finance. They also share a common secret: The details of their meetings, even their identities, have been strictly confidential.
Drawn from giants like JPMorgan Chase, Goldman Sachs and Morgan Stanley, the bankers form a powerful committee that helps oversee trading in derivatives, instruments which, like insurance, are used to hedge risk.
In theory, this group exists to safeguard the integrity of the multitrillion-dollar market. In practice, it also defends the dominance of the big banks.
The banks in this group, which is affiliated with a new derivatives clearinghouse, have fought to block other banks from entering the market, and they are also trying to thwart efforts to make full information on prices and fees freely available.
A previous post on ICE is here. It referenced this article
Finding the most common element in an array using SAS
Found a need for this a while back - nothing fancy here - if there is a tie only the first most commonly occuring element is listed.
/* Create a data set of 1000 records. An array of 10 elements is also created - we want to find the most commonly occuring element */
data temp;
array a(*) a1 - a10;
do id = 1 to 1000;
do j = 1 to 10;
call streaminit(215582 + id * j);
a(j) = round(rand('normal',5,4)) ;
end;
output;
end;
drop j;
run;
data temp;
set temp;
array a(*) a1-a10;
call sortn(of a(*));
count = 0; mode_count = 0;
do i = 1 to dim(a)-1;
if a(i) = a(i+1) and a(i) ne . and a(i+1) ne . then do;
find_first = a(i);
count = count + 1;
end;
else if a(i) ^= a(i+1) and a(i) ne . and a(i+1) ne . then do;
if count > mode_count then do;
mode = find_first;
mode_count = count;
end;
count = 0;
end;
end;
/* The last elements are the most frequently occuring once we reach the end of the array and a mode has not yet been found */
if mode = . and count > 1 then do;
mode = a(dim(a));
mode_count = count;
end;
/* If we reach the end of the array and count is greater than mode count then this must also be the most frequently occuring */
if count > mode_count then do;
mode = a(dim(a));
mode_count = count;
end;
drop i;
run;
/* Now let's check if it finds the correct ones */
proc transpose data = temp out=ttemp prefix=id;
id id;
var a1-a10;
run;
proc means data = ttemp mode noprint;
var id1-id1000;
output out = checkmode(drop = _type_ _freq_) mode=cmode1-cmode1000;
run;
proc transpose data = checkmode out = c prefix=checkmode;
var cmode1-cmode1000;
run;
data c;
set c(drop = _name_);
id = _N_;
run;
data ctemp;
merge temp c; by id;
if checkmode1 ne mode then flag = 1;
run;
data wrong(drop = find_first flag);
set ctemp;
where flag = 1;
run;
/* In macro form */
%macro array_mode(arrayname=);
call sortn(of &arrayname(*));
count = 0; mode_count = 0;
do i = 1 to dim(&arrayname)-1;
if &arrayname(i) = &arrayname(i+1) and &arrayname(i) ne . and &arrayname(i+1) ne . then do;
find_first = &arrayname(i);
count = count + 1;
end;
else if &arrayname(i) ^= &arrayname(i+1) and &arrayname(i) ne . and &arrayname(i+1) ne . then do;
if count > mode_count then do;
mode = find_first;
mode_count = count;
end;
count = 0;
end;
end;
/* The last elements are the most frequently occuring once we reach the end of the array and a mode has not yet been found */
if mode = . and count > 1 then do;
mode = &arrayname(dim(&arrayname));
mode_count = count;
end;
/* If we reach the end of the array and count is greater than mode count then this must also be the most frequently occuring */
if count > mode_count then do;
mode = &arrayname(dim(&arrayname));
mode_count = count;
end;
drop i;
%mend array_mode;
Pocket guides
I have never really had much use for pocket guides and I understand their 'pocket' size is so that I can carry it around and whip it out for a quick reference should I need it. But I wondered how I would ever use this and its related series.
Thursday, December 9, 2010
Some interesting papers
1. Limits to Arbitrage: Understanding How Hedge Funds Fail by Getmansky and Lo. The agent-based approach was interesting and yielded interesting (to me) insights. The paper is very rough and neither Andrew Lo nor Mila Getmansky have updated it. It occured to me that perhaps the agent-based approach is still a little ahead of its time despite all the talk about the failure of models.
... We propose that given positions are well diversified and notclosely correlated, leverage by itself does not lead to the collapse of a fund.Correlated positions in the absence of leverage might lead to a loss, but are notsubject to collateral collapse. However, the superimposition of both leverage andinduced high correlation between assets can lead to a collapse.
2. Evaluating the Impact of Development Projects on Poverty: A Handbook for Practitioners by Judy Baker. This is pretty much what it sounds like and the various evaluations undertaken by the World Bank in the annex was to me the most interesting part. Having been part of randomization projects (one clinical and one early childhood) I can attest to its complications and difficulties in terms of implementation and the annex shed some light on this. Various cost estimates were also illuminating - these ran much lower than the ones I was in and perhaps it was because these were in less developed countries. The stories one can tell from these projects could probably fill volumes and would definitely make one pause to wonder whether randomization really is the gold standard? I certainly do.
... We propose that given positions are well diversified and notclosely correlated, leverage by itself does not lead to the collapse of a fund.Correlated positions in the absence of leverage might lead to a loss, but are notsubject to collateral collapse. However, the superimposition of both leverage andinduced high correlation between assets can lead to a collapse.
2. Evaluating the Impact of Development Projects on Poverty: A Handbook for Practitioners by Judy Baker. This is pretty much what it sounds like and the various evaluations undertaken by the World Bank in the annex was to me the most interesting part. Having been part of randomization projects (one clinical and one early childhood) I can attest to its complications and difficulties in terms of implementation and the annex shed some light on this. Various cost estimates were also illuminating - these ran much lower than the ones I was in and perhaps it was because these were in less developed countries. The stories one can tell from these projects could probably fill volumes and would definitely make one pause to wonder whether randomization really is the gold standard? I certainly do.
Costs of rubbernecking
On our drives to and from Northern NJ over the Thanksgiving break we encountered two rubbernecking delays. On our way there a vehicle fire already on the side of the road snarled Eastbound I-78 from the Jutland exit (at least that was where we were when we were caught in the backup) all the way to the White House exit. Really, there was nothing to see even though the fire was on our side of the highway. The westbound side of I-78 was snarled even worse, spilling on to I-287 when we got off. The folks there must be wondering what the delay was all about especially since by the time they get to the scene of the incident the emergency vehicles would have already gone. It is also unclear to me that the vehicles on westbound I-78 who slowed to take a look could really see anything.
Unfortunately, once the front vehicles slow down, plus the fact that it was the day before Thanksgiving and volume was starting to build up, there is just no way that traffic could have been eased once the first cars start to gawk. The first cars tend to slow down, well, because they are in front and they see nothing ahead of them so the costs of slowing down for them is small. Unfortunately, they are imposing substantial costs on those futher behind them.
On our way back there was a truck fire - this time, not even on the highway in PA I-83 in a truck stop. There was a lot of black smoke but this was off the highway and the emergency vehicles were on the local roads. The back up stretched from the merge of I-81 and I-83 all the way through almost to Harrisburg.
So what can be done? There is no way to tax rubberneckers especially those in the beginning who essentially cause hours of delays for those at the rear. Some googling led to the following:
1. Installing screens around the scene (doubtful that this would work)
2. An impact analysis; from the conclusion and future research section (emphasis mine):
This study is the first attempt to evaluate the rubbernecking impact of accidents on traffic in the opposite direction based on archived traffic and accident data. ... Barriers are an effective way to reduce the likelihood of rubbernecking in the opposite direction and the delay caused by the rubbernecking ... It is also necessary to investigate the role of human factor on rubbernecking. As indicated in the analysis of this study, motorists in peak period tended to create less rubbernecking than in other periods.
3. An example of negative externality in Chapter 6 of Krugman and Wells (or here).
Unfortunately, once the front vehicles slow down, plus the fact that it was the day before Thanksgiving and volume was starting to build up, there is just no way that traffic could have been eased once the first cars start to gawk. The first cars tend to slow down, well, because they are in front and they see nothing ahead of them so the costs of slowing down for them is small. Unfortunately, they are imposing substantial costs on those futher behind them.
On our way back there was a truck fire - this time, not even on the highway in PA I-83 in a truck stop. There was a lot of black smoke but this was off the highway and the emergency vehicles were on the local roads. The back up stretched from the merge of I-81 and I-83 all the way through almost to Harrisburg.
So what can be done? There is no way to tax rubberneckers especially those in the beginning who essentially cause hours of delays for those at the rear. Some googling led to the following:
1. Installing screens around the scene (doubtful that this would work)
2. An impact analysis; from the conclusion and future research section (emphasis mine):
This study is the first attempt to evaluate the rubbernecking impact of accidents on traffic in the opposite direction based on archived traffic and accident data. ... Barriers are an effective way to reduce the likelihood of rubbernecking in the opposite direction and the delay caused by the rubbernecking ... It is also necessary to investigate the role of human factor on rubbernecking. As indicated in the analysis of this study, motorists in peak period tended to create less rubbernecking than in other periods.
3. An example of negative externality in Chapter 6 of Krugman and Wells (or here).
What is corruption and who founded corruption
Was Nixon the founder of corruption, or so asked K1 after a discussion in school on the topic. As much as some people might like to think so, it is unfortunately not the case. Coincidentally, I found the following from WaPo on the trial of Tom DeLay:
... Thomas Jefferson's 1816 remark that "I hope we shall . . . crush in its birth the aristocracy of monied corporations which dare already to challenge our government to a trial by strength, and bid deiance to the laws of our country."
... Thomas Jefferson's 1816 remark that "I hope we shall . . . crush in its birth the aristocracy of monied corporations which dare already to challenge our government to a trial by strength, and bid deiance to the laws of our country."
Lehman books and others
The “other” is Charles Gasparino's Sellout: How Three Decades of Wall Street Greed and Government Mismanagement Destroyed the Global Financial System and the Lehman books are Vicky Ward's Devil's Casino and A Colossal Failure of Common Sense by Lawrence McDonald.
Unexpectedly, of the three, the Gasparino book was the better. Unexpectedly also, the argument of the sub-title that government mismanagement destroyed our lives was not pushed as hard as I thought it would be, i.e., I thought that Fannie and Freddie would be denigrated and blamed but they were not blamed as loudly as I had expected. There is a trend throughout the book that the government actions essentially sowed the seeds for the next bubble – that when regulation clamped down on sector of the market e.g. junk bonds and Mike Milken, Wall Street merely moved on the the dot-coms and when that sector went bust, they just moved on to MBS. I thought that this book was actually a pretty good overview of the entire crisis.
The Lehman books were a bust. Vicky Ward's was better written and only the first half covered the crisis, with the latter part of the book devoted to Lehman's rise after its spinoff from American Express. It largely follows the lives of Tom Tucker, Joe Gregory, Dick Fuld, Chris Pettit whom she tries to portray as the person who was most responsible for its rise and the demise of Lehman was a rejection of Pettit's values. Its mostly a tale of betrayal as Pettit's demise set off a power struggle resulting in the rise of Dick Fuld and Joe Gregory who begin to live large. This was a nicely paced book and easy to read. MacDonald's book was a disappointment since I had expected an “insider” view. Unfortunately, MacDonald was one of maybe 5000 vice presidents in Lehman and was fired before the full Lehman crisis. His claim that Paulson hated Fuld's guts was not substantiated by other accounts (e.g. Ward, Wessel or Paulson). He also depicted the exit of Joe Gregory and Erin Callan as being a coup led by Bart MacDade which is not substantiated either. So much for insider views.
Unexpectedly, of the three, the Gasparino book was the better. Unexpectedly also, the argument of the sub-title that government mismanagement destroyed our lives was not pushed as hard as I thought it would be, i.e., I thought that Fannie and Freddie would be denigrated and blamed but they were not blamed as loudly as I had expected. There is a trend throughout the book that the government actions essentially sowed the seeds for the next bubble – that when regulation clamped down on sector of the market e.g. junk bonds and Mike Milken, Wall Street merely moved on the the dot-coms and when that sector went bust, they just moved on to MBS. I thought that this book was actually a pretty good overview of the entire crisis.
The Lehman books were a bust. Vicky Ward's was better written and only the first half covered the crisis, with the latter part of the book devoted to Lehman's rise after its spinoff from American Express. It largely follows the lives of Tom Tucker, Joe Gregory, Dick Fuld, Chris Pettit whom she tries to portray as the person who was most responsible for its rise and the demise of Lehman was a rejection of Pettit's values. Its mostly a tale of betrayal as Pettit's demise set off a power struggle resulting in the rise of Dick Fuld and Joe Gregory who begin to live large. This was a nicely paced book and easy to read. MacDonald's book was a disappointment since I had expected an “insider” view. Unfortunately, MacDonald was one of maybe 5000 vice presidents in Lehman and was fired before the full Lehman crisis. His claim that Paulson hated Fuld's guts was not substantiated by other accounts (e.g. Ward, Wessel or Paulson). He also depicted the exit of Joe Gregory and Erin Callan as being a coup led by Bart MacDade which is not substantiated either. So much for insider views.
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