Human Behavior

On the Persistence of Witches

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In the pre-scientific western world, sudden outbreaks of disease were often attributed to witches or other human agents of the supernatural. In many parts of the non-western world today, witchcraft is still feared and blamed. The need to seek human scapegoats for disease and general ill fortune seems part of our psychological makeup. Even in the  contemporary  West, we still seem to have the same psychology although in a different  costume.  

The twin cases of the world-wide collapse of amphibian populations and the colony-collapse disorder which affected the world’s bees, show the modern world’s need to find human scapegoats for natural disasters. In both cases human actors were initially blamed for the dire effects of diseases caused by  microorganisms.

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Cowardice is Eternal

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Glenn posts about an interesting case.

Two subway workers in New York called the police when they witnessed a rape in progress, but didn’t do anything to physically stop the crime. A case brought against them was thrown out of court, the judge saying that calling the cops is all that is required of witnesses.

Glenn isn’t any too happy about the ruling. He says….

“In a previous day, in a different culture, such men would have been afraid of being called cowards for failing to help a woman under such circumstances.”

I don’t think Glenn remembers Kitty Genovese. That particular incident might not have occurred in another culture, but it certainly happened in a previous day.

Look at it this way. At least the New York residents who saw the crime called police this time around. That is certainly an improvement over past performance. Maybe, after another four or five decades, people who live in New York will even become as brave as those of us who hail from flyover country.

Those who follow the links above will no doubt note that two of the three examples are where people who were legally carrying concealed weapons confronted a crazed killer. Since New York effectively bans that sort of thing, we really can’t expect them to have the same level of civic concern. This is, I think, one of the points that Glenn was trying to make.

But also note that the last link leads to the story of two unarmed vacationers who tackled a rifle wielding gunman who was shooting at the White House. Neither of them were from New York.

Finding a Less Costly Alternative

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I wrote last year about how I finally took the plunge and canceled my cable TV service.

The reason why I decided to let the television go dark was because advancing technology made paying for TV shows redundant. There are very few that I like anyway, and they are available for streaming free through a variety of websites. Add the fact that my charity work kept me extremely busy, so I would only have time to watch TV at some extremely odd hours, and you can see that online video-on-demand was the cost free way to go.

Things have loosened up a great deal since I shut down the charity self defense course in January. The course put such demands on me that going to an eight hour work day feels like an extended vacation, and I have a great deal more time on my hands. Even so, I still find that only a very few TV shows are at all interesting, and have no desire to start paying for cable service that I won’t watch anyway.

But that isn’t what I want to talk about. You see, now I’m thinking about canceling my phone service.

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Rush to Judgement

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Some of the best read bloggers have been outraged by this news item. The headline reads…

“Fire kills child, 3, and parents as police prevent neighbours from trying to rescue them”

If anything is going to produce outrage, it would be an account of how young and innocent lives were lost when they could have been saved. And all through a pig-headed application of the rules, to boot.

But my buddy knirirr has pointed out one or two things that have been missed.

Firstly, the report says that the neighbours were “beaten back by flames” which suggests to me that the fire was so intense that they would not have been able to get in and save anyone anyway. If this was a fire at night and there were no alarms installed then it could well have been burning for some time before anyone noticed.

Secondly, if the police really did quote H&S then they might not necessarily have meant it in the bureaucratic jobsworth sense that the Samizdata article seems to imply. I wonder if they meant “it’s too late, you can’t save them, you’ll only get killed if you try” but stated that the rules said so out of some misplaced belief that people will be impressed by being told that It’s The Law and are more likely to obey. We cannot know, but if so it clearly failed to make an impression in this case.

I find it very difficult to believe that five British police officers would stand by and let young children burn if they thought there was a chance for unequipped and untrained hands to help. Oh, there might be one or two here or there who would not care to make an attempt if it might mean their job. But five??? It seems likely that at least one, and probably more, of the officers were a parent themselves. For some reason, I don’t think sociopaths alone choose the police as a career.

It seems to me that there are a fair number of areas where Great Britain might improve. It also seems fair to me when someone points them out. But I don’t think this news article is fair.

(Hat tip to Glenn.)

Clever Mathematicians vs. Financial Risk

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See here (via here).

This is a timeless issue. The specific risk model under discussion isn’t the central issue. It never is. The central issue is that financial-risk models whose effectiveness depends on the accuracy of their assumptions about the distribution of securities-price movements eventually blow up. This is why “portfolio insurance” failed in (helped to precipitate) the 1987 crash, why Long Term Capital Management blew up, why Fannie Mae’s risk estimates vastly understated the real risk and why countless other “value at risk” schemes cause more problems than they mitigate. In simple terms, these schemes assume that in the event of portfolio losses you will be able to sell off your portfolio incrementally without incurring further large losses. In practice, the very fact that your portfolio is experiencing an extreme decline in value means there are no buyers except at lower prices and that further losses are probably inevitable: if the life boats are all on one side of your supposedly unsinkable ship you may still capsize if the passengers move there en masse. This is human nature and can’t be hedged away by invoking clever math, though clever people keep making this mistake (and will keep making it, because human nature doesn’t change).

In the long run the only reliable way to limit the risk in your market portfolio is to structure it so that you don’t lose money if the impossible happens. But this is expensive (insurance usually is), and it’s always tempting to lower your costs, and raise your short-run returns, by assuming you don’t have to worry about 100-year floods. The problem is that 100-year floods occur in financial markets every five or 10 years.

BTW, this is also why the notion of “stress testing” banks is fatally flawed. You cannot assess the risk of loss in a financial portfolio by asking what happens under conditions of moderate, i.e., likely, financial stress. If there is a systematic fatal weakness, however improbable, in your financial system the markets will eventually find it and the system will blow up.