April 30th, 2007 by De Onion

Anyone who has seen me have more than two drinks while playing poker knows that it’s very much a game of skill (unlike…you know…entirely chance games with negative expected returns…like Bingo)

Relevant to poker skill appears to be trading skill… and so in the interest of making a short but interesting post I’m going to provide a link to some trading psychology tests over at Market Psychology Consulting.


Choose life.

April 26th, 2007 by De Onion

The down side of eliminating walking as a daily necessity… (among other things)

There is real power in Urban Villages (in the suburb that is the entire island of Bermuda) and the widespread use of public transport… because the above photo is what happens if we let humans move toward their evolutionary tendency to seek high-calorie food and to avoid activity… which comes at the cost of social time and the ability of some people to develop social capital because they’re too busy spending their time with easy substitutes... which in turn affects social mobility. As a species we seem to be at a real risk of replacing our ancestral diets and social lives with cheap, easy alternatives. The cost of this is intergenerational and is potentially the largest market failure in history.

No, this post is not intended for the average Bermudian, but if the research is right then potentially if a few of the right people understand it we will be able to make Bermuda healthier and happier.

Knowledge and Decisions…

April 25th, 2007 by De Onion

I’ve been reading an interesting book by Thomas Sowell. Overall I find his personal opinions to be interesting, but in many cases he appears to abandon his affinity for empirical authentication in order to stick to his beliefs (as in the cases of his opposition to gay marriage, social healthcare, a USA minimum wage, and his allegations of liberal bias).

The conceptually useful part of his central thesis can be summed up by the following excerpts:

…the most fundamental question is not what decision to make but who is to make it and through what processes and under what incentives and constraints, and with what feedback mechanism to correct the decision if it proves to be wrong.

…to look beyond the goals, ideals, and “crises” that are incessantly being proclaimed, in order to scrutinize the mechanisms being proposed in terms of the incentives they generate, the constraints they impose, and the likely outcomes of such incentives and constraints.

In Bermuda this is overwhelmingly relevant to the way we are developing our land and building houses… as well as how our politicians make decisions.

But back to housing supply… we have a number of constraints that appear designed to minimize the housing supply and maximize cost (which are the same thing).

Setbacks – which today force builders to build back from the road, preventing recreating many of Bermuda’s most attractive buildings, while creating useless yard space next to the road.
– Zoning – There is only so much Res1, Res2, and Commercial.
Green Space/Woodland/Agricultural – limiting areas that can be developed and making many parcels un-developable.
Restricting number of units (rather than constraining square footage) makes larger/more expensive units more viable than small ones.
Government subsidies undercutting bottom-end projects (as a developer, why build inexpensively when the gov’t will potentially undercut you)
Building Code – We build long-lived concrete houses, rather than using the Miami-Dade standard which would also match our wind strength needs but could be built cheaply with a shorter lifespan.

What’s a suntan on an extrasolar planet?

April 24th, 2007 by De Onion

Much has been said about the discovery of an apparently habitable Earth-like planet outside our solar system… while this is a monumental discovery, the reality is that it should come as no surprise.

To really bake your noodle, have a look at Drake’s Equation and think about the implications… and don’t forget put things in perspective and to always look on the bright side of life.

You know, just to give some of the daily BS some overall perspective…

Liberal bias.

April 23rd, 2007 by De Onion

Neat to see the Royal Gazette begin to discuss the shift of PLP to somehow more right-wing authoritarian than the UBP.

However, aside from quoting a number of people who seem to have their own rationalized theories for their own bias, there doesn’t appear to be much serious discussion of the implications of policy. Instead we get to hear meaningless phrases such as a politician’s “commitment to change” – as if we somehow need to abandon the Bermuda economic model and adopt the Cuban one.

This certainly isn’t unique to Bermuda journalism – and I recognize that journalists are almost by definition not expert practitioners in any area on which they report, and that any RG journalist probably has more work to do in a limited amount of time than could be done to a high standard. I do think we need to make sure that Bermuda doesn’t follow into the disaster of intellectual laziness that occurred in the USA over the past 6 or so years and lead to people supporting some incredible policy failures. Sadly it’s very hard for many people to stand up for what is right because of immediate accusations of racism – just as the USA saw accusations of “liberal bias” made against those who dared to suggest that the Iraq war might actually cost $100 billion (it has since cost several times that). Interestingly enough, people do seem to seek out bias news sources that reinforce their predetermined views, which does make it harder to change people’s minds.

What I wonder is if anyone has actually taken the time to walk through the various policies of their parties and their implications…I may give this a go – to help alleviate accusations that this blog is too esoteric…

Here’s the question: Does the PLP have an updated Party Platform from the Ewart Brown era?

How do we think?

April 20th, 2007 by De Onion

One of my first posts was about the misidentification of problems in the public discourse – specifically traffic. I think is overly cynical about the motives of the government in proposing term limits and in restricting cars to expats… I think that many members of the government, just like their constituents firmly believe that these are good policies, but then are forced to accept more nuanced stances when the multiple realities of the problem become clear. The X-factor is likely integrative complexity.

In a nutshell integrative complexity is “…a measure of the intellectual style used by individuals or groups in processing information, problem solving, and decision making. Complexity looks at the structure of one’s thoughts, while ignoring the contents. It is scorable from almost any verbal materials: books, articles, fiction, letters, speeches and speech transcripts, video and audio tapes, and interviews.
Complexity has two components, differentiation and integration. Differentiation refers to the perception of different dimensions when considering an issue. Integration refers to the recognition of cognitive connections among differentiated dimensions or perspectives.”
Definition from here.

There are a large number of interesting relationships between politics and integrative complexity:

-IC peaks in the moderate liberal area of the political spectrum and falls at the ends, with the extreme left and extreme right showing the lowest IC scores.

-IC has been found to fall during times of stress – such as during wars and other nationally stressful events. This can be seen as evolutionarily adaptive behaviour which allows us to more easily rally behind a leader.

-IC is often lower during elections, then rises when a party gains power. We saw this with the PLP coming to power in 1998. Often hard-line campaigning followed by fairly liberal government.

I would encourage anyone who wants to understand a little more of the way hard-liners think and how policy views can change in seemingly dishonest ways to check out some of the many resources easily available through google.

On vacation…

April 14th, 2007 by De Onion

I apologise for the lack of posts recently, I’m off the island for a few days. Hopefully on the flight home I can pick up some issues – perhaps the world of unintended consequences.

Rat Racing

April 10th, 2007 by De Onion

The other day I had a conversation with an interesting long-term resident of Bermuda originally from the United States. We ran through culture, politics, business, and education. He made the interesting observation that Bermuda is perhaps the most right-wing country in the world (and not in the neo-Conservative Republican Fundamentalist Clown sense). His point was that discussion in Bermuda did not follow people’s feelings, goals, needs, social lives, and desires but instead focused on the job, the toys, and the “success” in life… reminding me of another time where a friend of mine who had worked in Venture Capital mentioned that from what he could see, money was how the rich kept score. On one hand, this game of success is one that a person can potentially win in a very big way – at the same time, even a massive amount of wealth in Bermuda does not make one’s life significantly different from a reasonably competent white-collar professional. In a small country where a motivated, educated couple can make over $300,000 a year combined, and where Ernest Stempel and Michael Douglas can be seen driving around in (Toyota and Opel) station wagons, there’s not much reward in winning the rat race (although those losing at life have a very hard time here). It does make me ponder how the marginal value of money changes in Bermuda vs. other countries.

Long-run immigration.

April 9th, 2007 by De Onion

These are probably dangerous thoughts in the wrong hands, and I haven’t fully thought them through or discussed them much yet – so they’re pretty raw and probably not fit for consumption and likely to change with time…

Many of our problems and successes as an economy are directly related to our unlimited talent pool that we are able to draw to this island…

1. Keep going ad-hoc and have a consistent and often arbitrary growth of population, including random laws that are designed to help Bermudians but in reality only reflect the ignorance of basic economics of the people producing the legislation (a topic for another day). This will in the long run lead to various Bad Things such as the eventual elimination of buildable land and a continuing rise of the cost of living, with an increasing share of basic necessities going to higher-earning professions that a very large percentage of people have no hope of entering.

2. Strictly limit net immigration. This avoids continuing rise in prices (at least relative to wages), but the current system means that there will be serious shortages of certain types of workers, new businesses will be unable to come to the island, old ones will find it impossible to grow, new local businesses will find it hard to grow, some basic services will simply not be done because there will be nobody to do them.

3. Find some way to apply a market based system of immigration. This is one of those things that if implemented badly would probably be worse than the current system. However, if we limit net immigration as we will need to do to keep Bermuda’s unique charm and economic success then we need to find a way to make sure that the highest value people to the economy are brought in (and preferably kept here long-term like my and every other Bermudian’s ancestors, again a topic for another time.) I don’t know if there is some sort of market that could be used . A market for immigration permits would potentially skew to the higher-income jobs and leave blue collar labour empty, but there must be some way to ensure that needs are met at a market price.

Free space…

April 8th, 2007 by De Onion

There are plenty of things we can do to better use Bermuda’s space. Personally I’m a big fan of the creation of high density villages and making much of the island undevelopable – with some motivation to make sure that it’s kept beautiful and not allowed to become a tangle of Brazilian Pepper trees… and I would also like to see any redevelopment of the airport to see the Civil Air Terminal moved over to Kindley Field Road and the large area of the disused runway extending into Castle Harbour used to create an urban village based on New Urban principles and having fast and efficient ferry service – one area where the Warbaby Fox may actually have a hope of speeding the commute.