The went to the Economics Society careers day today. Everyone was obviously keen to work at Macquarie, but apart from the money I have no idea why they would want to. It sounded like an awful machine. I've heard it's actually a good place to work from someone who did work there, but the whole graduate pulper they have going sounds pretty unpleasant.

I also listened to some Ellis chap from the Reserve Bank talk about that. He thoroughly quashed any aspirations I had to work there. Which I guess is fortunate, because at the end he suggested getting first-class honours if you wanted a job there. I don't even know what first-class honours are, so I don't like my chances of getting some. If it's something to do with get high distinctions, then I want no part of it.

But there was a company called BIS Shrapnel that I liked. Mostly because of their name, but also because the guy was the only one who really made sense to me. I think I would like to work somewhere like that for a little while. They are economists who don't like economic models. And that is exactly the sort of economist I want to be.

I've had another thought about how an ethical super fund could be used to save the world. It goes a little like this.

Ageing hippies and other good sorts put all their super money into this ethical super fund. It's an international fund and it gets a few billion dollars (or something) from peace-loving retirees. Its charter is to make money for its investors and use its resources to improve the world. Perhaps it guarantees to return at least the rate of inflation, or perhaps it offers a little more than that. But it's free to pursue strategies that don't maximise financial return.

This company invests a chunk of its money in normal ethical investments. The rest it uses as a cycling takeover fund. It takes over large companies and then reforms them. The "company" declares that it will behave ethically from then on. It signs contracts with various organisations vouching that it will fulfill various criteria. The company improves. The share price probably drops. The hippy fund sells for a loss, and goes off to do the same thing for some other company. Maybe the company will revert, but I imagine it could be quite difficult. You'll have other ethical investing companies who'll buy shares in it when they drop, and they'll have some influence and probably make loud noises when the company changes tack. It's also embarassing to suddenly change your mind, and might make shareholders even more flighty. People like the idea of acting ethically, even if they don't put their money where their rhetoric is. So I'm betting that if some of these companies were given a nudge, they might realise it's not as bad as they think.

But the fun bit comes in after the hippy fund has demonstrated that it's willing to lose money pursuing its hippy ends. After a while of that, merely the threat of being taken over, will make both the management and the shareholders at unethical companies freak out. The management doesn't want to be replaced and the shareholders don't want their share price to go down. So they'll reform themselves until they're no longer the least ethical company in an industry. Then the company that becomes the least ethical will freak out, and start reforming themselves. And so on, until all our nasty selfish unethical companies frighten themselves into creating a hippy utopia.

Even if the management wants to hold on and refuses to change, the threat of takeover (and the drop in the share price that would follow) will cause the share price to drop anyway. The hippy fund will get a bargain, and the share price won't drop any more once they take over, so they won't even lose any money.

The whole lovely scam makes me all happy with hope. I'm trying to think of the holes in it. The main one is that you need a whole lot of hippies who are willing to make less money than they could, at least in the short-term. But ethical companies have already found those sorts of people, so they definitely exist. The other risk is that nice ethical manager actually can't run a company to save themselves, so it's possible that the hippy fund will bring in some hippy managers to manage their company and they'll run it into the ground. The one thing you can say for the selfish, unethical arsemunchers, is that they are good at not running companies into the ground.

I just had an extra thought. While it's in charge, the hippy fund could issue a whole lot of options to itself, that it can only exercise if the company starts being naughty again. That will reduce the resale price a little, because potential shareholders will know they can't play up once they've rid themselves of the hippies, but I don't think it will by that much. And how cool would it be to have all these options floating around, that give hippies control of the unethical companies as soon as they become too unethical. Way cool. You could have an index of ethicalness, and companies who underperform the index just get taken over by hippies.

Just below my floor, there is some electrical fault, and there is loud sporadic sparking. We only just worked out it was electrical because I saw the sparks through a crack in the roof downstairs. They are such big sparks that my room vibrates when they happen. It's pretty cool.

My new bedroom is so small that it only takes about 15 minutes for it to heat up to full toastiness.

Apparently just because there isn't any evidence that this guy killed a young girl they aren't going to prosecute him. But I say that justice must be done. She was a young, innocent girl after all. How can we set this man free?

I'm a bit freaked out by those control orders Phillip Ruddock has got himself. I want to know who gave those to him and when. They suddenly whip out this new device which has nothing to do with our existing system of justice, and act like everything is life as usual.

And how the hell can Phillip Ruddock spout sewage like "Control orders are about protecting the Australian community" without falling into spasms of self-disgust? Every shitty injust "control" type bollocks that any government has ever used at any time in any country has been to "protect the community". Why would he want to associate himself with those wackos? Or does he pride himself on his impersonation of that pig in Animal Farm?

Tom and I went to see Miami Vice on Saturday. I don't think I've been to a film with Tom since The Three Burials of Melquiades Estrada, even though we've been living together virtually forever.

Tom was doubtful of Miami Vice because Dark Horizons didn't like it (he thinks), but I was confident and peppy. Michael Mann has always been a champ, and he was again. I thought everything about it was well done. Tom wasn't sure he liked the mood - he would have preferred more jokes by the black character. But I was all like the superficial black comic character is so overdone and those sorts of characters oppress the entire black community and make true reconciliation even more unlikely. Or something like that. Or maybe I didn't say that at all, but now I think about it, I should have said it. But mostly I disagreed it was because I like serious films with guns. I think guns are at their best when no one is being stupid with them, because they are only cool while you remember that they are deadly, awful inventions. I've never actually thought about this, but perhaps humour is one of the ways we glamorise violence in films. Maybe Pulp Fiction is let off the hook, because it's satire. I'm not really sure why some scarcely violent films make me squirm while other much more violent films are fine. I could just be an arbitrary sort of snob. There wasn't any glamour in Miami Vice. But it was very good.

There's an article about the cleverness of fish and how good they are at mazes and the like. The introduction said the findings could have an important impact on the way fishermen work. I was excited because I thought it might mean that fishermen would be kinder to fish. The whole fishing process horrifies me. The least bad way I've seen of killing fish is spear-fishing, and according to a spear fisherperson I know spear-fishing it isn't that good. Whether you're being dragged through the water by a hook through the most sensitive part of your body, or slowly suffocating on the deck of some trawler, I can't imagine the final moments of most tinned fishes is particularly fun.

So I read the article, and it turns out that the tests of intelligence will provide fisherman with a way of catching fish more effectively. They found out that fish have really long memories and can find holes in nets and work out how to escape from other situations. I thought that was really cool. The journalist reckons that means fishermen have to mend the holes in their nets. Stupid journalists. Stupid fishermen.

I've installed Beatrix on my laptop and it's fully noice. I've always had problems getting Ubuntu to run happily because 256MB just doesn't cut it anymore. Beatrix is part Knoppix, part Ubuntu, part custom-Beatrix fun. It's very fast. From the command line vi now opens in a snap. Opening vi had become a little ridiculous on Dapper.

So I get all the niceness and convenience of special, modern things like Ubuntu, and the speediness of those other distros like arch and Gentoo, that rather frighten me. Yay for that Watsky fellow.

There are issues with lighttpd1.4.11-3ubuntu1 and I'm guessing lighttpd1.4.11-3 in general. I had some weird experiences with PHP CGI, and the FastCGI instances freezing up and the webserver becoming unusable. Overall lighty is tops, but I've had odd instability problems with both Ruby and PHP on it now. Although it may be because FastCGI is still a bit fresh, and not a problem with lighty itself.

To create the bug I hit a Wordpress homepage with ab -n50 -c10 http://fatvegan.com/. It would reliably fail, although -c1 (no concurrency) seemed to work. Restarting always fixed the problem. I used top to monitor the php4-cgi processes, and they'd start out with activity and then every one would drop to zero CPU activity. Eventually ab would timeout.

I'm running Ubuntu 5.10 Breezy. The lighttpd package that failed was an Ubuntu package, but the hoary package I have now (1.4.8-4hoary1) seems to be stable.

Update: It wasn't that stable. So I upgraded to a specially compiled breezy package. It was less stable. So I have gone back again. I'd go back to Apache, but I've become seriously addicted to lighttpd's configuration and speediness. So much better.

We have all moved. Our new address is 202.177.221.42. There will almost certainly be many problems. Let me know.

We watched a nifty documentary on Cuba last night. Emily thought it would be really depressing and sad. But it was totally the opposite. SBS didn't manage to find any of the people who were really opposed to the government. It was mostly just about people who loved their country but were finding it tough going. No one seriously discussed leaving, although one of the Cuban intellectuals said he thought there were lots that wanted to leave.

Watching it has reinspired me to trot out into the world and be an economist. I've developed a pattern of being invigorated by badly shot documentaries on Latin America in the 80s and 90s.

It got me thinking and downloading Excel spreadsheets again. I was curious to know, of all those Latin American countries with a GDP higher than Cuba, how many actually give the money to their poor and middle class. So I found some data on income deciles across the world, and worked out the GDP per capita for everyone but the 30% wealthiest. Which is a far more interesting statistic than the normal GDP per capita. Invariably, the wealthiest people in a country are OK. GDP per capita is supposed to be a blunt measure of "wellbeing". One person with a lot of money and one person with no money doesn't really give you an average wellbeing of "pretty good". The maths does give you that though. The people economists are interested in are the bottom 50% or the bottom 90%. But, in general, not the bottom 100%. So I set about making my own measure of GDP per unrich capita.

The results were very interesting. I'll clean them up some time and post them. But basically, Cuban GDP per capita (for the poorest 100%) is between $3500 and $6000 (US) depending who you ask. If you assume that this is pretty evenly distributed (which may not be reasonable, because there isn't information on it), but if you did then Cuba beats every non-OECD country in the world. And it beats them all by a hefty margin. The only country that comes close is Slovenia with a figure of $2084. So if you're in the bottom 70% of the world (which a good majority are), and you have to pick a non-OECD country to live in, then Cuba would be a pretty good place. And that's purely on wealth terms. I haven't attempted to factor in their excellent rum or cigars. Or their catchy musical numbers.

So to all the poor out there, if you fancy a pay rise and want good schools for you kids and like good rum, you know where to go. Or alternatively, you know which socialist revolution to emulate should you wish to have one of those. Although I have to say, I think the Nicaraguans did a far better job of their revolution than Cuba has. Which may partly explain why America was so keen to stomp on it.

Oh my word. Amazon is so cool. They've built an elastic compute cloud, and it rocks I reckon. The sort of thing you might use to take over the world if you had a mind.

If I had any money I'd sure be buying some Telstra shares right now. Sol seems like a pretty clever chap after all.

Macroeconomics is also really lame. 90% of it is just trivial algebra, and the other 10% is just broad generalisations and assumptions needed to make the algebra simpler. But it's all good stuff to learn. At least I'm finding out all the stuff I'm not missing.

On the other hand econometrics is ultra cool. We're doing all this trippy matrix stuff, which I barely understand at all, but really enjoy. And not just because we have a cool lecturer who speaks in this laid-back, exaggerated Jamaican accent. What a champ.

I'm enjoying finance, because I'm learning about a whole lot of stuff that I've never understood. But even so, a lot of it is really lame. We learnt about share price valuations yesterday. The way you work out how much a share should be worth is by putting into Excel how much all the future earnings of the company are going to be, and then pulling out of your arse how much you think the company should return in profits (like 5% a year or 15% if you feel like it). Then you divide something by something else and what you get a that is the "value" of the share. Pretty damn lame.

Just then, I almost didn't do the washing up, even though I had time to do it. But I decided it would have been a bad precedent to start, so I did it.

Always remember to disconnect your electricity when you move out. The women who moved into our unit managed to use an enormous amount of electricity in the two weeks I was paying for her. A little more than triple what we had been using. I can't imagine what she must have been doing. Maybe she had several heaters on in both rooms of the house or something.

I feel like I want a non-capitalist economist mentor. None of the jobs on the trajectory I seem to be currently on will be happy anything less than pretty intense commitment to capitalism. I wonder if applying for a job with the Reserve Bank would be like someone applying for a job at the CIA thinking that maybe the US should give Texas back to Mexico.

It really worried me when Ben Thurley said something about national economic coordination that I think I disagreed with. If I think TEAR is too economically fundamentalist, then where the hell am I going to go?

I reckon superannuation should be mandatory and set at 15% or 20% with no tax-deductions, but all the tax earned goes to funding the age pension for the generation that pays it. I don't really understand why the government should use subsidies to encourage people to leave their children a sustainable pension system. If what Ross Gittins claims about the cost of income tax forgone is true, then the current system isn't really increasing the sustainability of our pension system at all. In fact the system stores up large amounts of wealth in private accounts, that will only be used for benefit of a small number of people. The main problem is that my generation won't be able to generate enough wealth to keep both my generation and the next generation at a happy level of wealth (whatever level that is). If some of the wealth stored up in super accounts was spread around more thinly as an age pension then that problem would be less severe. We need to be saving as a society, not as individuals. The age pension is very low, but the majority of old people currently live on it.

I don't really think there is a problem at all. I wonder if the whole crisis has been invented to let the government give more wealth to rich people - who realistically would have saved for retirement anyway. It's all based on the old fallacy that any money given to the government disappears into a bottomless pit, which means that if we can achieve a little by depriving the government of a lot then it looks like a bargain. Stiglitz wrote and interesting paper on it. I would like to be more like that fellow. Indeed I would.

I've been wondering about managed super funds, because common sense and anecdotal evidence suggests that managed funds with high fees (like most super funds) are a waste of money. I found a good, short paper and it finds that this is pretty much the case. Out of 33 managed funds it reviewed only 3 made a better than normal return after management fees were subtracted. On the bright side, only 2 funds lost money. The rest basically did nothing. So managed funds aren't really worse than indexed funds, based on that evidence, but I don't why you'd bother. You're more exposed to market drops, because I'll bet they don't drop their fees as fast as the market drops when it does. So if the market does nothing for a year, with a managed fund you might still pay 3% but with an indexed fund you'll get to keep all your money.

I was going to go with Perpetual, because they have impressive returns on the surface, and are probably one of "the three". But you pay about 2.5% points more for about 5% higher return than Hesta. When those returns compress, which I expect they will, I reckon that advantage will go away.

I'm putting 2/3 of my super into shares, which I feel a bit uncomfortable about. Shares seem to be inflated to me. Although I like this graph of price/earnings over the past few years. Inflation of share prices is tricky to measure I suspect, although I suppose profits are like "real output". I should try and understand all that stuff some day.

I just downloaded 35MB of iTunes installer in about 15 seconds. I love Optus Cable and I love non-wireless LANs. So fast and reliable.

Did Hizbullah not kill 159 Israelis, including 116 Zionist soldiers? Nasrallah wins the war

Hezbollah, a terrorist organisation, killed 159 Israelis in one month, 72% of whom were soldiers. In Iraq America has killed 5212 soldiers/policeman and 40133 civilians, making military casualties 11% of the totals. I'm inclined to think that sometimes it is an artificial distinction, but even so that is appalling. And if the distinguishing characteristic of terrorism is that it targets civilians, then it appears that neither Hezbollah nor the American military are very good at the things they are supposed to be good at.

The local councils in a bunch of different towns had called streets Kaka St, thinking kaka meant parrot. But it didn't.

My life feels like a big mess at the moment. Although I didn't manage to bring an ethernet cable into my box today so I could get internet. So I suppose it's not all bad.

For as long as I can remember I have weighed 64kg. Before I was vegan, while and was vegan and since I stopped being vegan. Always 64kg exactly.

But after my knees going bung, and the physio telling me my skinniest was bad for my joints, I decided I'd start eating more to put on weight. And it worked! I officially weigh 70kg. Hurray.

Stavros is such a pirate. I told him I'd move out on the 4th of July. He begged me for several days to move out a week earlier, on the 31st so his new tenant could move in. I dragged Libby and her family back to the house to move all the stuff out, and we worked all day that Saturday so we could be out by the end of the day. And we made it by 5pm. Stavros charged me rent until the 6th. I called him, and he told me to call him back later on.

I called Ray White today and Stavros has left. And he hadn't filled out the forms that let us get our bond back. What a total real estate agent.

Three isn't a very good phone company. My phone was disconnected for four weeks during June and July, and I wasn't able to work out why. Then I figured it out and paid them some money for something. Three weeks later they reconnected it. And I was happy. But the next day I got SMSes telling me they'd disconnect my account. So I called them, but it was all OK they said - I wouldn't be disconnected. The SMSes stopped. For two lovely weeks a called my friends and life was good. Then my phone stopped working again. I would have called the company, but my phone was disconnected so I couldn't. When I did call them, they said they didn't know why I was disconnected, but I would have to call some other people the next day because it was their fault. They offered to call me back, but when I gave them my mobile number they said they couldn't call me back because the phone was disconnected. This morning I spent a healthy amount of time on our enigmatic home phone, trying to connect and understand the various people who were talking to me. When I finally got to the person I needed to talk to, the home phone hung up and gave me some merry high-pitched whirring noises. I decided to go to work and call from there. I just did and they said the problem was all sorted out. I tested my phone and it worked. I was happy. I asked them why it had stopped working. They said they didn't know. I asked who I should call if it happens again. They said they were the people to call.

Only four months until my contract ends. I might throw a little tea party or something.

Unlike HDD Enclosure that required to transmit files through computer, V-Gear LANDISK builds in low powered CPU and supreme top DDR, which could connect to LAN and operate independently as a file server; trustful and power-saving. Some random product blurb

Markdown seems way better to me than Textile even though they get compared. Textile strikes as just another one of the many formats. Maybe I little better than MediaWiki, but not great. Markdown is so elegant. And you can put HTML in it if you want, which is the real winner.

Although even more than I like Markdown, I would like if everybody settled down, stopped inventing new markup languages and agreed to use one or the other.

Update: The annoyingest thing about Markdown is that a single new line isn't converted to a <br>. It wouldn't be such a huge deal if it didn't make a lot of my old posts unreadable.

I have a business idea. That's an unusual thing for me. Most of my ideas involve breaking other people's business models. Or my better ideas anyway. But this idea is a business idea, and it's an idea that would make money, and solve some problems for insurance companies, and solve some problems for the government, and even solve some problems for vulnerable old people. Actually the bit that solves some problems for insurance companies is a separate idea that could motor along on its own if it felt so inclined.

So the main idea is simply property-backed annuities. Retirees can sign over their houses to insurance companies in return for a guaranteed pension and the guarantee that they won't be kicked out. Capital growth in the house goes to the insurance company - who eventually sells it - but they can use the assumption of eventual profit to subsidise the pension. The retirees don't have to worry about land taxes or managing cash flow, or having to get a mortgage on their house to pay for food. It means the government won't have to pay pensions to asset-rich retirees - who then just leave the in-tact house to their children when they die. Unless you have some funny system like I've suggested I suspect there would be a lot of pressure for the government to give pensions to people who are actually very rich, but appear poor when plastered on the front of The Australian.

Part of the problem we have is that my parents generation have accumulated large amounts of property, partly because they haven't paid anywhere enough tax over the past few decades. While it's probably too hard to collect back-tax (not to mention a little unfair), and a lot of that wealth has disappeared as consumption, there is still a lot of that unpaid tax holed up in houses and such. You could argue that if the property just gets left to their children then maybe it doesn't matter that much. My generation won't have to pay that much rent or much of a mortgage, because the average 1.7 children is probably close to the average 1.7 investment properties. So all us kiddies get our own house, but the flipside is that we have to pay 60% income tax or something so the government can feed and medicate our ailing property mogul parents.

One reason not to do that is that it's probably better to get the capital markets to put up the the cash for food and medication, rather than the government. Another is that those nice houses would have been effectively partly owned by the government if taxes had been at the right level, so it's not really fair that those assets are passed on to those people lucky enough to have parents wealthy enough to really benefit from low taxes. So it might be better than those assets get redistributed around the place when that generation dies, and that the government saves a whole bunch of money on pension payments.

So people with property are guaranteed a pretty nice income, which could be subsidised by the government possibly if it's not quite nice enough. People without property get a less nice (probably) government pension. The insurance companies get houses and capital growth for as long as our parents are alive. Children of rich parents get nothing. Children of rich and poor parents get a government with a balanced budget and income taxes somewhere below 60%.

There is still the problem of healthy people being more likely to take up the offer than sick people. Insurance companies have to break even so the more healthy people there are, the less of a bargain the deal looks like to sick people. Because sick people might have to put up their whole house and then die 12 months later.

I think maybe that can be overcome, although not because of anything special about my idea. The government can insure very healthy people, or subsidise people who end up living for a long time. The government would have to pay pensions to those people anyway, if the insurance companies don't, so the government doesn't lose. I suspect maybe it will generally seem like a good deal to health and sick people alike, just because they don't have to worry about stuff.

I had this other idea, that people could choose a number of years, after which they want to have a reduced payment. A sick person might choose 12 months, and get a lot of money early on, but less afterwards. A health person might choose somewhere way down the line, because they expect to live a long time. They'll want to spread out their pension. The insurance company can use that information to give sicker people a better deal for their house. The cost of trying to pretend to be sick in order to get the better deal is that healthy people might live for 20 years on a reduced pension. I'm not very good at those sorts of numbers (or most sorts), so I'm not positive that will work as I'm expecting.... I just had a little fiddle in Excel and I think it does work. You need to pay sick people more at the beginning, and healthy people more overall, but not pay sick people so much more at the beginning that healthy people are better of pretending to be sick and putting their extra money in the bank. I don't know if that makes sense. I'd post the Excel spreadsheet, but everyone who had got this far would truly want to stop being my friend.

I reckon maybe that thing I just talked about might work for all insurance pension sorts of things. You just have to wangle the numbers the right way. Give healthy people an incentive to tell you they're healthy, and sick people no incentive to pretend to be healthy, and you're all set. You can work out who is who, and give them all the right amount of money. At least I think so.

I've forgotten if there were still other things I needed to talk about. Insurance companies are happy... yes. Old people are happy... yes. Government is happy... yes.

Except bugger. It started out being a business idea, where I would make lots of money. But it ended up being another rant about how if everyone does what I tell them to, things will sort themselves out nicely.

Unless I go start my own insurance company, which was my original plan I think.

So then so far on my list of things to do this life:

• Start microfinance bank with consumer retail arm
• Start global superannuation behemoth that dominates all political decision-making
• Start an insurance company large enough to pay out billions of dollars in pensions every year
• Be an astronaut
• Start a cheese farm