Naked Capitalism has this fabulous article Did Money Evolve? You Might (Not) Be Surprised. If Ron or Rand Paul would read this and understand it, it would blow their minds. Now that is something I would pay “money” to see.

This conflation of “money” with currency-like financial securities reveals a basic misunderstanding of money that pervades the economics profession. That misunderstanding is based on a fairly tale.

In the golden days of yore, it is told, all exchange was barter. Think: Adam Smith’s imagined bucolic butcher and baker village. This worked fine, except that your milk wasn’t necessarily ready and to hand when my corn came ripe. And moving all those physical commodities around was arduous. This inserted large quantities of sand and mud into the gears and wheels of trade.

But then some innovator came up with a great invention — physical currency! Coins. “Money.” This invention launched humanity forward into its manifest destiny of friction-free exchange and the glories of market capitalism.

Except, that’s not how it happened. No known economy was ever based on barter. And coins were a very late arrival.

Later on in the article, the author posits this definition.

At this point you’re probably drumming your fingers impatiently: “So give: what is money?” Here, a bloodless and technical term-of-art definition:

The value of assets, as designated in a unit of account.

Ironically, one thing that even this article misses is the slipperyness of the concept of “value”. Some times the unit of account is given its “value” by the assets it will buy. In times of inflation and deflation, the “value” of the unit of account changes drastically. So it is rather circular to say that the value of assets is designated by the unit of account whose value is designated by the amount of assets it represents. In truth, there is no such think as a constant that represents value.

Naked Capitalism has posted the article The ECB’s Original Sin and Franco Modigliani’s Long View.

However, unemployment is not a potent instrument to control inflation when there is plenty of slack, while it has a considerable impact on social welfare.

Note the emphasis above that I have added. Too often people seem to think that a prescription to cure a particular ailment should be used to cure every ailment. Decent economists always tell you the specific circumstances that call for a specific remedy.

Even for me, some of the terminology of the article was a bit confusing. The section below explains how central banks could stimulate investment when the only power they seem to have is to control monetary policy. Monetary policy is weak to completely ineffective in stimulating investment when there is plenty of slack in the economy.

As the manifesto itself recognised, the proposed reinterpretation of the ECB role would meet with serious objections. One was that central banks are unable to stimulate investment.
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The ECB has proven unable to raise inflation through its QE programme. Higher price dynamics cannot be achieved if the monetary stimulus fails to reach the real economy. When the latter is in deep recession or deflation, and fiscal space is limited, only monetary finance can be effective as it allows newly created money to be transformed into additional (public or private sector) spending without raising public debt. One way to apply money finance at the whole EZ level would be through an initiative whereby the European Investment Bank would issue bonds to finance a large investment plan for the area, and the ECB would purchase the EIB bonds with newly created money. Through such initiative, money finance would pursue the inflation target by stimulating demand and reducing unemployment. The new investment financed would strengthen the output potential of the Eurozone.

When people wonder why their is no private investment in more production capacity, I like to frame it as “What part of no freakin’ customers do you not understand?”

Wordfence has a very interesting article Password Authentication and Password Cracking. They suggest you set aside an hour to read this article.

If you don’t have a clue as to why you need a strong password and what makes up a strong password, then you might gain a lot from reading this article. It also might educate you on some obvious signs as to whether or not you are logging into a service that will protect your password after you create it. For instance, if the service ever sends you your password to you by any means, then it is not serious about protecting your password. (I am not talking about temporary, one-time passwords. I am talking about a password that you invent and give to the service.) The wide variation in how services handle passwords is the main reason why you never want to use the same password for more than one service.

Introduction to Authentication

In this article we’re going to explore different authentication mechanisms. An authentication mechanism (or method) is a way for you to prove that you’re allowed to access something. Passwords have been the default method of authentication for as long as most of us have needed to prove to a computer that we’re allowed to access it. However, passwords are not the only authentication mechanism.

Since I have known about salted hashed passwords since at least 1983 when I first used Unix, it didn’t take me that long to read the article. If you have similar experience, you will find it fairly easy reading. I was pleased to learn about some details that I didn’t know before about how password cracking has evolved and how the protections against it have evolved, too. I have also worked with massively parallel computers, but I don’t think that was part of what allowed me to understand the article any faster than someone without that experience.

Here is an email I received from Alan Grayson. Alan spells it out in a way that no other politician will. We have to empower the Bernie Sanders’ wing of the Democratic party, and take power away from the Hillary Clinton wing. If we don’t do that, we will have a continuation of all the problems that Alan Grayson describes.

I have deactivated all the contribution links in the email. If you would like to, you can contribute by using this Alan Grayson For U.S. Senate link.

The Washington Post has the article Cosmic breakthrough: Physicists detect gravitational waves from violent black-hole merger.

“It had a very rough beginning,” Weiss said. “The [National Science Foundation] had a tough time explaining to other people why they would back such a crazy thing.”

This is a great scientific event. It is of significant interest to anybody who enjoys knowing about and reading about physics.

Now, let me go on to its political significance. This is scientific socialism at its best. There was no money in it for private enterprise and the capitalist free market to sponsor it. It could only be done be an extremely wealthy philanthropist who liked science enough to spend $1 billion over ten years, or it could be done by “government”. However, the government did not own the means of production, so there were plenty of contracts given out to the capitalists to build the experimental equipment.

Benjamin Studebaker has posted the article Why Bernie vs Hillary Matters More Than People Think.

This is a wonderful article that explains why I am so adamantly opposed to electing Hillary Clinton instead of Bernie Sanders. It is a fight for the soul of the Democratic Party. If we lose that fight, then the Democratic Party is not worth saving. You might even say that there is a special place in hell for what the Democratic Party has become under Carter, Clinton, and Obama.

In the years since 2008, many Americans, in particular young people, are willing to consider the possibility that neoliberalism–the economic ideology espoused by both the post-Reagan republicans and the post-Carter Clinton-era democrats–is fundamentally flawed and must be revised or potentially replaced entirely.

This can only happen if democrats recognize that Bernie Sanders is not just a slightly more left-wing fellow traveler of Clinton’s. This is not a contest to see who will lead the democrats, it’s a contest to see what kind of party the democrats are going to be in the coming decades, what ideology and what interests, causes, and issues the Democratic Party will prioritize. This makes it far more important than any other recent primary election. The last time a democratic primary was this important, it was 1976. Only this time, instead of Anybody But Carter or Anybody But Clinton, the left has Bernie Sanders–one representative candidate that it is really excited about. The chance may not come again for quite some time.

Hillary Clinton is a neoliberal building on the legacy of Ronald Reagan and Bill Clinton. She doesn’t understand the pivotal role inequality plays in creating economic crisis and reducing economic growth. She has been taken in by a fundamentally right wing paradigm, and if she is elected she will continue to lead the Democratic Party down that path.

Bernie Sanders is a democratic socialist building on the legacy of Franklin Roosevelt and Lyndon Johnson. He understands that inequality is the core structural factor in economic crisis and that growth in real wages and incomes is required for robust, sustainable economic growth.

It doesn’t matter which one is more experienced, or which one’s policies are more likely to pass congress, or which one is more likely to win a general election, or which one is a man and which one is a woman. This is not about just this election, or just the next four years. This is about whether the Democratic Party is going to care about inequality for the next decade. We are making a historical decision between two distinct ideological paradigms, not a choice between flavors of popcorn. This is important. Choose carefully.

I received this email from the Sanders campaign. For people who only know about what Hillary Clinton said about Bernie’s plan, here are some more details.

William K. Black has a second article in his series, this one titled How Many Lies Can the WSJ Pack into a Chart on Liar’s Loans?

If you don’t read this article you have no way of knowing just how fraudulent Wall Street has been, nor how clueless are the people that Barack Obama put in charge of prosecutng Wall Street. I had the “pleasure” of engaing one of these clueless appointees in a Facebook exchange.

Here is an excerpt from the article.

I have discovered even more amazing indicators of fraud in my pro bono efforts on behalf of alleged fraud “mice.” One of the largest home lenders in America ordered its staff – in a passage that they put in all-caps to highlight its importance – never to verify the borrower’s income on liar’s loans even when the underwriters could have done so without any expense. In particular, while the underwriter was permitted to call the employer and verify the borrower’s employment, the underwriters were forbidden to verify the borrower’s income even though they had the boss on the phone line staring at the employee’s records. Everything about liar’s loans screams “accounting control fraud” by the lenders’ controlling officers.

Crooks and Liars has the video excerpt I have been looking for from the CNN Democratic Town hall

At about 3:35 into the video below, Hillary Clinton said about the billionaires,

They could care less about income inequality. They salve their consciences by giving big money to philanthropy. And, you know, getting great pictures of them standing in front of whatever charity they have donated to.

Is she trying to describe the purpose of the Clinton Foundation? I have often thought that the billionaires might do good works by giving philanthropy, but they might have done much better by not stealing the money from the middle-class in the first place.

One also has to wonder if the Clintons have any self-awareness at all.

The Hartford Courant has this article and video Video Shows State Police Discussing How To Charge Protester.

Picard told The Courant Thursday that he was standing near a state police DUI enforcement checkpoint near the on-ramp to I-84 on Park Road at about 7 p.m. holding a sign that read “Cops ahead. Keep calm and remain silent.” He said he also had a handgun visible in a holster on his waist because Connecticut is an open-carry state and he had a valid permit for the gun.

What this really shows is that some state laws lead to a paradox. Picard was legally and openly carrying a weapon. It is also true that people openly carrying weapons logically scares the hell out of people. Is there a solution.

I know the feeling of the passers-by. I was driving home from work in Oregon one day. Less than half a block from my house there was a teenager standing in his driveway aiming a rifle toward the spot in the street that I was about to pass by. I took a detour and notified the police. What do you think I should have done instead? Should I have just continued to drive, and hope to hell I wasn’t going to get shot? Should I have taken the detour, not notified the police, and hoped to hell the next person by wouldn’t get shot?

Then there was the time I was walking to my car in my employer’s parking lot. A person was getting into his pickup truck and momentarily a concealed handgun revealed itself. I knew that guns were forbidden on the property. A call to company security revealed to me that the person wearing the concealed weapon was a security officer employed by my employer.

I maintain that there is a difference between being frightened by people because of the color of their skin or some other ethnic identifier and being frightened by someone carrying a gun, especially one that is about to be aimed at you. In the one case I am suffering from a belief in a stereotype of what someone is (and has no choice about) and an observation about someone who chooses to carry something that does threaten my life.