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Sunday, March 27, 2016
11-09-15 Modigliani's "Nu Couche" recently sold for $170.4 million
Economic bubbles are fascinating specifically because they have little to do with economics, and everything to do with human behavior. In other words, little to do with logic, and everything to do with intuition.
Goods and services have a fundamental value reflected in how the thing contributes to our calories or shelter. Yes, there's more to life than than being fed and dry, but values become more abstract and subjective once security, health and aesthetics become factors. And things get REALLY crazy when human vanity, greed and speculation are brought to bear. These last factors are the source of economic bubbles.
Bubbles are driven by the "Greater Fool Theory" in which the value of something will increase with each transfer as long as there is another a greater fool. Well, until there isn't. The guy holding title when the music stops is the loser. That's when everyone realizes the price of the last transaction was absurd. In other words, there were no more greater fools. After that, the object in question's "value" will drop dramatically and its market go quiet for decades. Whomever is left holding the bag will have to wait until "the thing" comes back in fashion. If ever. There are lots of fools in history, but no one ever talks about their transactions, especially the fools themselves.
Even though the lesson of economic bubbles has been presented many times and in vivid detail, the lesson never seems to take. Or maybe I should say, there always seems to be a greater fool. In the interest of those thinking about becoming a fool and chasing the next bubble, I'll present some historical examples of the phenomenon, their characteristics, and why it's ill-advised to get involved. Finally, for those still interested, I'll present my candidate for the next bubble, and why. Maybe you can get in (and out) early. Let's review some of the more famous bubbles to understand how they expanded, collapsed, and their ultimate impact upon our economy.
The genesis of bubble behavior almost certainly goes back to ownership of property itself. There are likely examples lost to history, but one of the earliest and most vivid major economic bubbles was Tulip Mania.
Strange as it may seem, it was literally the selling of future contracts for, of all things, tulip bulbs. Don't let this humble flower fail to impress you. The demand was amazing, and provides an example of human behavior run a muck with a thing called fashion. For a flower.
In February of 1637 there were examples of single tulip bulbs selling for the current equivalent of ten years salary for a craftsman - for EACH bulb! This was certainly in the hundreds of thousands of today's dollars. Yep. One flower bulb, a decoration for the table. The key was that each bulb was unique in color and pattern. These bulbs could be farmed, and their contracts traded. Even though many similar families were bred, uniqueness is well, unique. And unique allows for amazing rationalization, or shall we say irrationalization?
Some of the stories are amazing. In one case, a workman mistakenly assumed a valuable tulip bulb on the kitchen table of his employer was a common onion. He sliced it up for his sandwich, (appreciating it for its aesthetic flavor, and fundamental value in calories). When discovered, he was sent to debtor's prison for his error. There are many other examples of how these crazy tulip prices destroyed people's lives. Mania is a good description for the love of these flowers and the strange market it created.
Though this bubble was narrow (a small part of national wealth), it was extremely deep (10,000 multiple). Though narrow, the dramatic multiple significantly increased the asset value of the Bank of Amsterdam for a time. After the bubble popped, negative effects were felt for years. In less than 90 days from the peak price, a tulip bulb was only worth, well, a tulip bulb. It could be argued that the workman was the most rational person in that economy. A couple of smaller tulip bubbles in other areas happened later, but the value of tulips has never again approached that peak anywhere in the world.
South Seas Bubble
You'd think Tulip Mania would be chapter one in every business book for centuries, but less than 80 years later everyone seems to have forgotten the lesson. The South Seas Bubble had almost nothing to do with the South Seas. Instead its major asset was literally HALF of England's debt. The hopeful trade with South America allowed for the instruments of speculation (contract shares), and much of the government was complicit in promoting the investment. Soon, people were borrowing to speculate. The shares increased ten-fold before they popped. This bubble was both wide (half the national debt) and fairly deep (ten times any possible fundamental value). When the price collapsed, the resulting debt depressed the economy of England for years.
The First Tech Bubble
Let's move to modern times. The first tech bubble has many good examples, but one I know well - they were a competitor. In 1982 Fortune Systems was building a 68000-based micro-computer system. They raised $110 million in a public offering at a half a billion dollar evaluation. Yes, these numbers are modest compared to today, but in 1982 this was the 7th largest IPO in U.S. history, and 500 million was a lot for a new company with no profits that had shipped fewer than 200 units, most of which were having problems. Of course the investment was lost when the product didn't pan out. This "little" bubble popped. There were other early public tech offerings but except for a few like Apple Computer, they shared the same fate. This shows bubbles don't have to be big to be crazy. This was a modest bubble at the time, but it provided a taste of what was soon to come.
Tokyo Real Estate Bubble
Japanese real estate prices started rising dramatically in 1986 and were highest in Tokyo's Ginza district in 1989. Choice properties were fetching over 30 million yen per square meter ($20,000 per square foot!). Prices were only marginally less in other large business districts of Tokyo. Literally HALF of the WORLD's real estate value was in one relatively small island called Japan.
By 1990 the party was over. In 2004, prime "A" property in Tokyo's financial districts had slumped to less than 1 percent of its peak, and Tokyo's residential homes were less than a tenth of their peak, but still managed to be listed as the most expensive in the world, only being surpassed in the late 2000s by Moscow and other cities creating their own bubbles. The Tokyo bubble was both wide and deep. Tens of TRILLIONS of dollars worth of "asset value" were wiped out with the combined collapse of the Tokyo real estate and dependent stock markets. Only 18 years later in 2007 had property prices begun to rise, before falling again in late 2008 due to the global downturn. Japan has not yet recovered. It's now been decades.
The Internet Leads the Second Tech Bubble
On the day Netscape went public I gave a talk explaining how there was NO reason to value a company with NO revenue and NO profits at almost 4 BILLION dollars. As it turns out, this too was just a taste of what is common today. By the time the internet bubble crashed in the spring of 2000 it had created an estimated 6.2 TRILLION dollars in value, 90% of which disappeared within weeks. Even though mostly limited to only a segment of technology, this bubble was widely subscribed. It's impact was felt for years.
U.S. Housing Bubble
As money shuffle out of the internet, I began wondering where it would go next. I watched in disbelief as house prices doubled (or in some cases tripled) in California, Nevada, Arizona and Florida. At the peak, lotteries were held for the RIGHT to buy new residential construction. By 2006, some high-end properties were being sold for up to $700 a square foot at nearby Lake Tahoe, which was far beyond its value in materials. The difference was (ir)rationalized by location, but even in Reno some places sold for over $500 a square foot. And Reno is on the edge of a vast desert whose value approaches zero.
I don't need to go on about the housing bubble. Everyone else already has. I'll just note that it represented "assets" of around 10 TRILLION dollars and seems to have triggered a collapse of a credit bubble on Wall Street of even greater magnitude in late 2008. This housing / credit bubble was also devastating to main street, which continues to be affected six years later.
Chinese Real Estate and Debt Bubble
What may come to be known as the Chinese bubble is similar to what happened in the west but may be far larger when evaluated in retrospect, once good data is available. In the United States, approximately five million "extra" housing units were constructed during the early part of this century. China has built between 70 and ONE HUNDRED MILLION housing units in a similar time-frame. Now, China has a lot more people and many of them need houses, but there was a disconnect in market forces for of this construction. Most of these units are executive homes and do not match the need nor demand from the market. Mitigating these glorious ghost cities will be far more difficult than foreclosing and reselling the American homes. If you own anything in China, sell. Which brings us to the point of this post. Where will all the fools go next?
05-05-14 - "Forget it, Jake; it's Chinatown" - more signs of cracks in China:
Zombies once destroyed Japan’s economy—now they’re infecting China’s
11-19-14 - Prices have tripled to over $2600 per square foot in Hong Kong since 2003
The Next Bubble...
Now that bubbles are understood, we'll never again get caught. Right? Not necessarily. In Wikipedia on Bubbles it's noted that bubbles are generally identified in retrospect, much like bull and bear markets. Bubbles sneak up on people. As a matter of fact, people (and their human behavior) seem to be their secret sauce.
Is a fool someone who pays more for a thing than its fundamental value? Or is a fool someone who doesn't manage to sell the thing to a greater fool before the music stops? As the price increases well beyond fundamental value, at what instant does one become a fool? Where do the lines get drawn? In retrospect it's easy. Seeing that line while it is happening is more of a challenge.
The truth is, ALL investors are fools to one degree or another. It's just a matter of how long we feed the bubble, and how it eventually deflates. It's all depends on where you get in, and where you get out. That's where the human behaviors of greed, denial and fear come in.
So what will be the next bubble?
Real estate? Not in our life-time. Population growth is finally flattening out and may even head down in a couple of decades. In any case, China will be the final nail for real estate bubbles. The upturn in the U.S. real estate last year was just a dead cat bounce. It will abate soon, and mark the beginning of a long flat market for residential real estate in America, and around the world, with a few exceptions.
Stocks? Nope. Like real estate, the current bull market is just a return to normal after the crash. There's already stock bubble talk, which will likely dampen the drive upward in time.
Gold Bubble? Nope. It's too obvious to do more than double unless we have major civil disruption. Also, since it has virtually no fundamental value, it could be argued that gold is always in a bubble. By degrees.
The next significant bubble will be none of the above. The next bubble will be in collectibles, and it's already well underway.
... will be a Zen Bubble
Let's start with contemporary paintings. According to Businessweek, auction sales of postwar contemporary art has gone from a few million dollars in 1988 to nearly $8 billion dollars in 2014. And most of those gains have been since 2003. In another article, Businessweek notes, "There has been a 434% increase in value of the top 50 contemporary and postwar artists since 2003". A record high of $142 million has been set for "Three Studies of Lucian Freud" who only died in 2002. Usually artists have to be dead for MUCH longer to fetch such absurd prices.
A total of almost $66 BILLION of fine art was sold in 2013. That's only ONE year of ONE segment of collectibles. There's also fine wine, cars, books, stamps, money and too many other obscure segments to be named, which is the real point. With tulips, it was only tulips. With web start-ups, it was only web start-ups. In collectibles, there are at least a million places for fake value to hide, many of them unique. This bubble has truffles at $100K per pound, a figurine for $5 million and a puppy (!) for $1.5 million. Did you even realize people collected truffles? I didn't. And a puppy dies.
The point is, the prices for art (and cars, and wine, and etc.) reflect far more than typical aesthetic value. These prices are dominated by speculation. This is clearly a bubble, no matter how you wish to (ir)rationalize it. Or more precisely, these are bubblets as each of these segments lives in its own world of "investors" who generally ignore the other segments. There is no limit to their (ir)rationalized value. This segmentation is what will make this bubble so different from the ones that have come before. This bubble is not a bubble at all. It's more like foam rising off the euphoria of too much champagne. And as foam, it will play out in a far different way than the typical bubble.
This collectibles bubble is both wide, deep and insidious. Worse than its absurd dollar value is its stealth. The types of collectibles are almost infinite, since virtually anything ever created by man or nature can be collected.. Many unique items are literally in a class of one. If it has value to anyone, it has value to a speculator. And if it has value to a speculator, its price will ultimately be driven far beyond it's fundamental or aesthetic value.
Like other bubbles, the price of any unique item or the whole segment will increase right up until it doesn't. If you dig deep, you'll find many examples of bubblets collapsing, but most investors don't even notice unless they own something in the segment, or that particular item. When each price collapses, these collectors lick their wounds in silence. Who wants to brag about a loss?
Its stealth nature will be the hallmark of this bubble. This collapsing foam of bubblets will not make any major news, well unless a big segment such as fine art collapses in general. But that's less likely because each piece can be effectively (ir)rationalized then hidden away, which will be another aspect of this bubble - the absence of liquidity. Pieces will ultimately be hard to sell, and will therefore go back in the closet. We may even see a time when collectible sales drop off, and the items simply used as collateral for loans, which may drive yet another credit bubble. In any case, this Zen bubble may go on for decades. Or longer.
Since a unique item can have a theoretically infinite value, expect some wild examples. Here are a few I've "collected" over the last several years. Most are just headlines or links. You'll have to Google for details.
The next questions is, "when will we see the first BILLION dollar transaction for something with no fundamental value?"
10-23-14 Apple I Price Update - $905,000!
$330K for 2.87 lbs of rare white truffle!
05-23-11 A Rolex wristwatch made in 1942 sold for a record $1.16 million at Christie's!
$194K for a 38 inch toy boat once owned by Malcolm Forbes!
$302,500 for Andy Warhol print of Mao Zedong - TEN TIMES the estimate!
1923 Leica 0-series becomes world's most expensive camera, fetches $1.89 million at auction!
Marilyn Monroe's Seven Year Itch dress, which went under the hammer at auction on Saturday, is a record breaker. The iconic white dress fetched $5.5 million!
A Stradivarius built in 1721, which once belonged to Lord Byron's granddaughter, sold online for $15.9 million!
06-27-2011 - A Jean-Michel Basquiat self-portrait sold for $3.3 million, five times more than in 2003!
World's oldest running car fetches $4.6 million at auction
10-24-11 - Gerhard Richter's 1982 painting Kerze (Candle) fetched $16.6 million at a Christie's sale, an auction record for the artist, who says the price is "as absurd as the banking crisis".
12-03-11 - Why IS Art So Damned Expensive?
11-07-11 -Queen Victoria's bloomers sold for $15K, three times estimate. Skid marks included for free.
Rare 1787 Gold Coin Sells for $7.4 Million
11-14-11 - Roy Lichtenstein's 1961 painting, I Can See the Whole Room!... and There's Nobody in It! sold for $43 million
11-30-11 - A set of eight scrolls of lotus flowers PAINTED THIS YEAR by Chinese artist Cui Ruzhuo sold for $16 million!
01-16-12 - The ultimate inflation: A 1793 copper one-cent coin sold for $1.38 million at Heritage Auctions, an increase in value of more than a hundred million times.
02-19-12 - The 1889 van Gogh Vue de l'asile et de la Chapelle de Saint-Remy formerly owned by Elizabeth Taylor sold for $16 million.
02-20-12 - The 1963 Francis Bacon "Portrait of Henrietta Moraes" sold for $33 million.
04-09-12 - A Ruyao bowl that dates from 1086 to 1106 sold for $26.7 million at Sotheby's, a record
05-01-12 - This year paintings by Warhol and Munch are expected to sell for more than $50 million each. WRONG!
05-04-12 - Munch's "The Scream" went for $119.9 million dollars, more than twice estimates. Warhol's Elvis only brought $37 million, for an average of $78.5 million, 57% over estimates.
Why did this Mini sell for over $65,000?
05-08-12 - A teacup Lady Gaga used last year in Japan sold for $75,000. What's next, used toilet tissue?
05-09-12 The $412 check that DC Comics gve artist Jerry Siegel and Joe Shuster in 1938 to buy the right to the Superman character fetched $160,000 at an online auction.
05-11-12 A blue flannel New York Yankees baseball cap worn by Babe Ruth in the 1930 is on the block, estimated to be worth $400,000.
05-15-12 Mark Rothko's fiery 1961 canvas, Orange, Red, Yellow fetched a record $86.9 million after a $45 million estimate.
07-07-12 Joan Miro's 1927 Peinture fetched $37 million at Southeby's
08-20-12 Cover art for issue 328 of The Amazing Spider-Man sold for $657,250, a record for comic book art.
09-01-12 and setting new records in each category:
Cezanne's painting "The Card Players" for $250 million
Superman's first edition went for $2.16 million.
The first map of the United States for $1.5 million
A live Red Tibetan Mastiff puppy for $1.5 million
Audubon 1st edition bird book $11.5 million
10-18-12 - The two guns taken off Bonnie Parker and Clyde Barrow sold for a total of $504,000. I wonder if they could have appreciated the irony.
10-22-12 - Two 1941 Sun Yat-sen stamps sold for $709,000
11-19-12 - The 1951 drip painting Number 4 by Jackson Pollock sold for $40,400,000 at Sotheby's.
Indian weddings have become a bubble and are an excellent example of bizarre human fashion. The wedding industry in India is now growing at 25% per year. India is now consuming 30% of the world's gold production, and half of it goes for Indian weddings. The estimates for 2012 wedding costs in India are about $40 billion, and this is in a country with a per capita GDP of only $4000. Could this gold be considered a collectible?
1988 Jeff Koons sculpture of Buster Keaton on a horse - sold for $5 million 12-17-12
2013 It's not exactly collectable, but perhaps ephemeral gastronomic art? A record price for a single tuna of $1.8 million was paid for one 490 pound fish.
01-24-13 - "Rick Champagne, a 56-year-old company owner from Arizona has bought the original Batmobile (dating back to Burt Ward and the '60s) for $4.2 million. He's quoted as saying it 'was a dream come true.' From the article: 'The Batmobile design was based on a 1955 Lincoln Futura, a concept car built in Italy by the Ford Motor Company. It was the first time that car had come up for public sale since it was bought in 1965 by car-customiser George Barris, who transformed it in 15 days, at the cost of $15,000 (£9,400), into the superhero's famous vehicle.'"
03-20-13 - A blood-stained sock worn by Boston Red Sox pitcher Curt Schilling in the 2004 World Series fetched $92,613 at auction.
04-06-2013 A 1909 Honus Wagner baseball card sold for $2.1 million
$38 Million for a car?
07-01-13 An untitled 1982 painting by Jean-Michel Basquiat sold for $29 million at Christie's
09-04-13 A vintage Ferrari Spyder convertible sold for 28 million in the same week that a diamond and a yacht went for about same amount. Is $30 million a special price point?
10-14-13 Sotheby's sets new record prices in China with $30,800,000 for a diamond, $30,500,000 million for a bronze Buddha and $23,300,000 for Zeng Fanzhi's, "The Last Supper", the highest price ever for a contemporary Asian artist.
11-18-13 The car that won the 1954 Formula 1 world championship, a Mercedes-Benz W196R coupe became the most expensive car ever sold at $30 million.
04-30-2014 "In 2013, one blue-fin tuna was auctioned off for $1.7 million..." I hope they froze some of it.
05-01-14 Even sales of early scraps of an artist's work have exceeded a million dollars:
DYLAN'S 'LIKE A ROLLING STONE' HEADS TO AUCTION
05-15-14 I'm not sure if unique houses qualify as collectible, but it's hard to imagine any other reason to pay this much and it would certainly break the billion dollar absurd threshold I mentioned above :
The Most Expensive Homes in the World
And one more from the age of opulence:
This Absurd Mansion Features Star Trek-Themed Rooms And Could Be Yours For $35 Million
And what's up with Popeye?
Steve Wynn paid $28 million for Jeff Koons sculpture of Popeye.
Andy Warhol's Popeye is appraised at $50 million.
Roy Lichtenstein's Popeye is appraised at $47 million.
It makes one want to open a can of spinach and draw some cartoons.
Why are so many people paying so much money for art?
"Owning collectibles offers one major advantage – one that I think drives 90% of the demand for collectibles: It's a great way to protect your wealth from the IRS. People know that when they die, the IRS won't have any idea what is hanging up on their walls or hiding in their vaults. So they hide money in these trophies to give to their children to avoid estate taxes. Mind you, I'm not passing judgment on these actions, nor am I recommending them… I just believe that's why a lot of demand for collectibles exists.
Collectibles are also easily transferable across borders. You can take a Picasso on a private jet and move $100 million offshore. And no one even knows you have it.
When you buy collectibles, you're betting on the irresponsibility of the government and the wickedness of the tax system… If the government gets more irresponsible and the tax system gets more heinous, you'll probably do well. And I think that's a good bet. But you should understand that's what you're betting on."
04-29-14 - The above observation is an excellent example of how tax policy can distort markets. It's also an excellent reason to collect, and a reasonable rationalization.
07-09-14 Claude Monet's "Water Lilies" sold for $54 million.
09-04-14 A copy of the first Superman Comic which originally went for ten cents sold for $3.2 million yielding a multiple of 32 million times it's original value.
09-07-14 A 1962 250 GTO Ferrari sold for $38 million and is lifting prices for all sports cars of the era - a nano-bubble of its own?
09-18-14 - Hyundai spending $10B for 20 acres turns land into a collector's item for the first time. This is in the price range of the Tokyo bubble of 1989. They could have done a lot better in the Nevada desert like Tesla just did - a THOUSAND acres for FREE. Even Tesla's 370 acres in the BAY AREA, some of the more expensive land on Earth only cost them $42M - and it had a 5.5 million square foot working factory on it! Has Hyundai been bit with bidding fever in the process of taking the site away from Samsung? Did this bidding war turn this plot into a collector's item?
10-16-14 BUY THE PAINTING HOLD THE PAINTING SELL THE PAINTING
From the above link: "A Francis Bacon triptych set an auction record for any artwork, at $142.4 million. Jeff Koons’s sculpture Balloon Dog (Orange), at $58.4 million, set a high mark for a living artist. An Andy Warhol picture of a Coca-Cola bottle sold for $57.3 million, pushing the overall take that night to $692 million, at the time the biggest single sale of art ever."
"The final price for Apocalypse Now, including the buyer’s premium paid to Christie’s: $26.4 million. It had appreciated roughly 350,000 percent in 25 years."
11-25-14 - The Cowardly Lion costume from the classic film "The Wizard of Oz" and the piano from the movie "Casablanca" each sold for over $3 million at a New York City auction.
01-19-15 - $100 Million New York Apartment
5-5-15 A Honus Wagner baseball card sold for $1.3 million
5-12-15 Picasso's Picasso's Les Femmes d'Alger, "Version O" sold for $179 million, a record.
05-13-15 A Mark Rothko painting sold for $46.5 million at a Sotheby's
Hedge fund billionaire Steven Cohen is the secret buyer of the world’s most expensive sculpture, Alberto Giacometti’s “Man Pointing,” for $141.3 million at Christie’s.
06-20-15 A Hermes Birkin purse sold for $222,000.
11-11-15 Cohen's Warhol `Mao' Portrait Fetches $47.5 Million at Sotheby's
11-11-15 Titanic cracker sells for $23k
11-30-15 $173k paid for a Michael Jordan jersey
12-17-15 A letter signed by Mao Zedong sells for $918,000
02-05-16 1937 Mercedes 540K sets Arizona record at $9.9 million
02-16-16 Delaware license plate #14 sold for $325K as an investment. Here there was no magic art involved at all, just a magic number.
02-28-16 The most paid for a Basquiat was set in 2013 when $48.8 million was paid for Dustheads:
06-01-16 An auction yielded $1.3 million dollars for the Winchester rifle owned by the Army captain who captured Geronimo.
Saturday, March 26, 2016
First posted in 2012:
From our pay-stubs, to our soft drinks, to our light-bulbs, to our bedrooms, to our toilets, the government is demanding more and more control of our lives. When will we finally say enough is enough? When will we reach our "John Galt" moment? When will we take our government back?
Last November Gary Johnson set a record for the Libertarian Party at one percent of the vote. He might have gotten far more except that most of America had no idea there WAS a viable third choice. Indeed, most of America agrees with more of his actual policies than any other candidate. Gary WILL make an excellent president and help move government back away from our door:
So how do we help gain awareness for Gary Johnson over the NEXT four years? I have an idea.
In Atlas Shrugged, "Who is John Gault?", was a rhetorical question reflecting the futility of the system. The question was asked over and over by the hopeless, but it also became hope itself for those who KNEW John Galt.
A similar question needs to be asked again, but not in fiction this time. If every time we see injustice in big government we reply with this question, maybe the nation will come to realize there IS an alternative.
If you agree, each time you see a Facebook, Twitter, LinkedIn or Blog post describing government taking away your freedom, simply leave this comment:
"Who is Gary Johnson?"
At first these comments may annoy and confuse people, since anyone can Google the answer. And many will. That's important:
The Battle for Freedom NEVER Ends
Wikipedia - Gary Johnson
But for the rest of us, it'll be a way of reminding others how critical we believe our freedoms are.
And in time the question itself will take on a life and meaning of it's own.
So... will YOU ask a simple question for freedom?
Who IS Gary Johnson?
Keep asking until we get some answers.
03-26-2016 Libertarian candidate gains in polls
Friday, March 25, 2016
Monday, March 07, 2016
First posted on 8-7-2013:
"Absolutely" sets a new standard for "most abused word".
|My granddaughter Leah searching for absolutes|
Turn on any interview show. Within seconds you'll hear the word, "Absolutely!" Even worse, it will probably be the response to some relatively complex issue that doesn't even approach any absolute condition.
Why is "Absolutely!" such a common answer? Is there really that much certainly in our world? Nope. It's the result of lazy thinking.
"Absolutely" is being applied to things that are not only NOT absolute, often they are not even probable. Consider the source. Who is the spokesman? Politician? Anyone else with a bias? See what I mean? Ironically, the very opposite of their "absolute" assertion is often the case. Strangely enough, the more emphatic the claim, the less likely it is to be true.
"I did not have sexual relations with that woman" and "there is absolutely no sex of any kind" - President Bill Clinton, 1998 from public statement and deposition
This onslaught of "absolutely!" is an excellent opportunity for some critical thinking. Consider possible exceptions to the assertions as they are being stated. Under what condition might the statement NOT be true? See what I mean?
Years ago I had a close friend who, when I'd make some brash statement would say, "As opposed to?", then follow it with possible exceptions. She was very good at this, and it became a game we played. So I stole her trick. It's great mind candy, and quickly begs an even more important question - is ANYthing absolute?
Seriously, isn't "absolutely" simply an idea? A creation of the human mind? Is it not our aspiration to see things all one way, or all the other? Isn't "absolutely" merely a bad case of polar thinking?
"Absolutely" doesn't really exist. Seeking the truth is best approached asymptotically, leaving the end-point for the weaker mind. It's like "unsinkable", "unstoppable" or "immovable", each an admirable goal, but not achievable in the real world. "Unsinkable" didn't even complete its first voyage.
So is NOTHING absolutely true? Nope. Well, not likely.
THIS statement MAY be the ONLY absolute.
I can imagine everyone now bringing to mind their favorite absolutes - God, love, mathematics, gravity. I could go on and on, and so can you. So let's start with the most popular:
Many of you think me an atheist, but you'd be wrong. I'm at best (or worst) an agnostic. And I have doubts about that. But I DO hold that each of us should be given the tolerance to explore as we wish. And that's the key - we need to keep an opened mind.
God is not only an over-loaded word (many meanings), it's also one of the most over-loaded concepts we have in all the various aspects of human culture. Unfortunately, the truth of God does not have a very good track record, under any religion.
Compare the "truths" of God, Jesus Christ, Buddha and Mohammad as documented. They can't ALL be right. To be candid, I think Mohammad, Buddha and Jesus Christ may have been a pretty impressive guys, but you wouldn't know it from all the contradictions and contemporary interpretations. To be fair, let's take each one separately. They still get interpreted in many different ways by different "believers". Again, even for any one religion, they can't ALL be right. And if any of these doctrines were absolutely true, why would there ever be need for change? And yet they DO change from time to time.
Let me get specific about the absolute aspect of God, not religion. Is our existence (or its illusion for some), proof of God? Hardly. Our "existence" is demonstratively discoverable, and aspects of it are changing day by day. Make a statement about existence, and a thousand others will provide counterpoints. And that's WITHOUT questioning perception and relativity. I could go on and on, but everyone else already has. Keep an opened mind. Even about God.
So, what about love? It's so pure and simple, it MUST be absolute. Unfortunately, love too is a highly over-loaded word, concept and feeling. Love goes mystic as an experience, but all you have to do is ingest some MDMA to produce it's subjective conviction. This clearly demonstrates our experience of love is at the very least, part of a chemical feedback loop in human behavior. And the conviction you feel on your wedding day? Give it seven years. Again, love's track record is no better than God's. Actually, it's quite a bit worse.
Ahh... mathematics - it's perfection itself. Hardly. Math is only a game we play in our struggle to understand the world. Mathematics is a creation of the human mind, and simply a tool for science. If you look closely, the "truth" of mathematics flows from its usefulness in the observations we've made, or else is some form of identity - wholly disconnected from reality, which again makes it simply an abstraction of thought, which is more of an illusion than an absolute.
“As far as the laws of mathematics refer to reality, they are not certain; and as far as they are certain, they do not refer to reality.” – Albert Einstein
But gravity you say! That's never fails us!
Don't be silly. Of course it has. Along with all the other "laws" of science. All you have to do it go into orbit. OK, that's not fair. The subjective experience of gravity just takes on a different form in orbit. But seriously. Ever heard of the 30 years that shook physics?
In the late nineteenth century it was thought that all science had been discovered, there were just a few refinements to be made. There was even talk of shutting down the patent office. And then along came Einstein. That's when all hell broke loose (not related to God).
Suffice it to say, we have more organized doubt in science now, than in any time in history. And that's healthy. And that's the point. Any student entering the field of science today who does not have an opened mind is a fool. If he "believes" in math, if he "believes" in science, he is likely to be worse than useless in his endeavor. He may actually distract us from approaching the truth with his questionable conviction.
Like mathematics, scientific absolutes are an illusion of the human mind. Instead of discovering absolutes, science is how we claw our way forward in thinking. Just don't hold too tightly to your conclusions, while you reach for the next hand-hold. You'll find it easier to grasp.
So the next time you hear someone exclaim, "Absolutely!", let your mind wander to all the exceptions. Then realize the person making the statement needs a lesson in critical thinking. Help them out. Explain that their conclusion may only be a useful generalization.
If you have any other "absolutes", please comment below. I'll do what I can to help you test them.
Who knows, maybe you'll find one.
But I doubt it.
Perhaps the best statement on the topic:
"I would rather have a mind opened by wonder than one closed by belief." - Gerry Spence
Another similar conclusion:
"I'm not absolutely sure of anything" - Richard Feynman in 1981 from this interview:
Richard Feynman on Religion, Science, the Search for Truth; Our Willingness to Live with Doubt
Half the "Facts" You Know Are Probably Wrong
There are NO Absolutes. There is NO Absolute Truth!
03-07-06 Everything Is Crumbling
John Oliver: Scientific Studies
Monday, February 29, 2016
Thursday, November 19, 2015
There seems to be a shortage of good entry level electric cars, perhaps until now. The Arcimoto is just over a thousand pounds, gets to 60 MPH in 7.5 seconds, go 80 miles on a charge and, sell from under $12K. If this vehicle can be delivered with this spec and price, it will make a significant advancement for local transportation:
Arcimoto SRK 8
Thursday, October 15, 2015
1996 was a major turning point for Burning Man. Some say it's when Burning Man grew up, others, when it jumped the shark. I think it jumps the shark (and many other challenges) every year. The best summary I've heard is, "Burning Man's the thing same every year - completely different.
Anyway, 1996 was before my time on the playa, but here's the best film I've found on the topic:
Burning Man 1996 "No Clemency For The Wood""
Also before my time on the playa:
1997 to 2000
And other content that spans several years:
2001 to 2010
Burning Man Timelapse Pre-2014
Thursday, September 10, 2015
First posted on 02-14-2008:
Click the play button to start the performance...
A friend forwarded this a couple of weeks ago, but I of course waited until today to pass it on.
At first you'll see the sand painting as the most obvious form of expression. But quickly you discover the phased transitions define a whole new type of choreography. The painting has a very limited life, which brought me to realize the art is more of a performance than than the images it creates.
With the unfolding story, it's more like, "dancing fingers in the sand". Or to get distracted with an Elton John alliteration, "tiny dancer in your hand". Like watching God's in the act of creation.
This artist is certainly the spirit that makes sand dance.
So simple. So effective.
Or do I see too much in the movement of sand?
Great music too.
Happy Valentine's Day!
Bigger You-Tube version...
Sunday, August 09, 2015
10-27-10 - The Yike Bike has been trumped! Not as powerful or fast, but quite impressive in it's minimalism.
Sunday, June 21, 2015
What Ever Happened with H2S Induced Hibernation?
I wrote this post on April 22, 2006
One year ago today, something extraordinary happened...
Mark Roth at Fred Hutchison Cancer Research Center in Seattle announced the astounding ability to induced hibernation in mice by having them breathe 80 parts per million (ppm) hydrogen sulfide gas (H2S). Yes, that's the gas that smells like rotten eggs.
Not only did these critters fall asleep for six hours, their heart rate and respiration dropped by 92% - apparently replicating the effects of true hibernation. And their temperature dropped to 2 degrees C above ambient temperature. They in effect became cold-blooded.
It should also be noted, when the gas was removed, the mice awoke with no apparent ill effects. The critters could still run their maze in a normal fashion.
There are hints that H2S Induced Hibernation might be a natural defense mechanism or at least a normal biological process. It appears this H2S gas is produced by the body under certain conditions and may be the key to normal hibernation. This may also be the cause of "Cold Water Shock Reflex" in which those who have "drowned" in cold water come back to life.
At 80 ppm, H2S can not simply be replacing O2 in the blood which exist at 210,000 PPM in typical air. It seems that H2S acts more like a hormone causing ALL cells in the body to slow down at the same time. Is H2S the body's way of adjusting the thermostat?
Hold on! I'm way out of my element here. I'm not qualified to do biology. I'm not even qualified to write about it.
But I DO considered this ASTOUNDING news! And indeed the world reported it. Well at least in a tepid way (sorry about the pun). From the BBC to the Washington Post they did at least rehash Mark's original work. Even Wikipedia added three paragraphs to the Hydrogen Sulfide (H2S) page. I was impressed with that.
But THAT was it...
No follow-up questions.
No follow-up answers.
No in-depth reporting.
No detailed analysis.
No flying out to Seattle.
No camping on the lawn.
No helicopter shots.
No checking tax returns.
Hell, Tom Cruise jumps up and down on a couch and the media follows him around for weeks! Where is the coverage for the stuff that REALLY counts? Oh well. I would wait. There was sure to be more news on the topic in a short time. So I set my Google news reader and waited...
And I'm still waiting.
It's been one year. Other than some comments from an aging blog and one think tank, there has been nothing at all. Nothing! Am I way off base or is this NOT a Nobel class discovery?
Where's the follow-up from Mark Roth?
Where's the H2S Induced Hibernation blog?
Where are the frat boy posts about their flatulent experiments?
Where's the Flatliner crew?
Where's Kiefer Sutherland when we need him?
Where are all the science fiction plots?
When I read the news release last year, I thought follow-up would be like the coverage for Cold Fusion a few years ago - lots of people trying to reproduce the results. Maybe we would even get some quick test with humans.
What's a geek to do? There's only one thing. Ask the questions that SHOULD have been asked a year ago. So here goes.
Does this Roth effect work longer than six hours?
Does it work for days?
Does it work for weeks?
Does it work for months?
Does it work on other larger mammals?
Does it work on humans?
Any obvious side effects?
Any long term side effects?
How long can someone stay under without ill effects?
Does this low-level metabolism consume fat like it does in bears?
Does muscle tone also atrophy?
Does this low-level metabolism extend life?
Is 80 PPM a threshold or is there a proportional effect at 40 PPM? 20 PPM?
What happens at 160 ppm? Is the sleep deeper? (yes, I know H2S is deadly at higher concentration, but so is table salt).
Is this truly a natural feature of mammals? If H2S is produced internally, can the effect be induced by meditation? If so, how does one exit the state?
I could go on and on but you get the idea. To get the answers to these and other questions, first they have to be asked. And then asked by the right people. That's what this blog post is all about. We need the right people asking these questions - not me.
There's a saying in the world of finance, "Capital finds it's highest and best use". This seems to take a little longer with science. It also takes imagination, speculation and a whole lot of promoting.
Promotion is important. America was not named for Columbus. America was named for a navigator and blogger of the fifteenth century - Amerigo Vespucci. His letters were published widely on his return from the new world. He didn't discover anything, but promoted what he found. The name stuck.
That's why H2S Induced Hibernation now needs to be all about blogs, Digg and Wikipedia. It's up to us. It's time for some speculation. Maybe even some speculative fiction. We need serious talent applied to finding the answers to the above and other questions. More discussion may help.
Here are some ideas as to how H2S could be used. Maybe this will help move things along.
Time in trauma care - This one is obvious. With such low concentrations of H2S needed, a simple regulator mask in first aid kits might extend that "Critical Hour" to a "Critical Day" giving time to do a better job with transport, evaluation, and treatment. It's easier to stop bleeding when the heart is only pumping eight times per minute. It's easier to keep cells alive when their demand for resources has dropped by 92%.
Mine Disasters - During the recent mine disaster in West Virginia, the miners only had air for one hour. Could this have been extended to 12 hours by adding a little H2S to those respirators? Coal mine accidents are an even bigger problem in China with over 6,000 dead per year. Think of the lives that could be saved even if a small percentage had this advantage.
Fire Escape - Since most fire deaths are caused by smoke inhalation, many extra minutes could be gained with one of those new and improved masks from the coal mine? Check the first-aid kit. Is it there yet? Again, the lives saved would be in the thousands world-wide.
Underwater Rescue - Another good application for limited oxygen? And maybe a re-make of the movie Abyss? Lots of possibilities here.
ALL incurable disease - This is a no brainer. Got a problem? Take a break for a while. Wake up to review the literature. Take another break. Repeat until cured.
Medical scheduling - Waiting for an organ? Make sure you have enough time. It's better than death.
Military Use - Lot's of possibilities here, from trauma to transport. Here's where Kiefer Suterland comes in with a new release of 24 Hours lived in 24 years. How's THAT for a challenge to his premise?
Sleep Efficiency - How about all that time we waste sleeping? Might we extend our life by taking it deeper? Or maybe the opposite, and find out how to shorten sleep? Keep an open mind.
Weight Loss - this could be a biggie, both in terms of dollars and quality of life. Let's say you're not a fan of winter anyway. Why not do like the bears do? You could wake up ready for your new spring swim suit.
Capital Punishment - This is a bit radical, but at least it's not a death sentence. And they aren't causing any problems in the mean time. In time we might even find a "cure" for murder.
Pregnant Mothers - This might at first seem radical too, but Mark Roth's page refers to "embryonic diapause, a pause in embryonic development found in about 70 species of mammals". It might be useful one way or the other. Don't count it out.
Punishment - What the hell. Let's put them ALL on ice as a cost reduction measure! We could count it as good time. Would it still be punishment? Fun to think about. (note - after I wrote this I found one blog post at World Think Tank that talked about using H2S for prison riot control. Could we extent this to riot control in general?)
Athletes - Since I'm getting radical, how about extending the performance window of our very best athletes? We could give them the option of waking up every four years in time to train for the Olympics. The other option would simply be to let them "rest" off season.
Space Travel - Yep. Classic application. Maybe we could finally do some. There are at the very least, some fresh movie plots here, or the chance to make them more realistic.
Time Travel - This is of course relative and one direction. But how about sleeping a few weeks at a time and find yourself subjectively rushing forward into the future? It might be fun.
Tivo for life - This is an extension of the time travel idea - sort of fast forward when you want, live life when YOU want. Let's say you're a basketball fan but hate the rest of the year - beep, beep, beep. Treat the boring parts of life like one big commercial. Live life on YOUR terms!
Tivo for the heart - Will H2S sleep dampen a heartache? I think Heinlein used this in "Door Into Summer". Would it help? Who knows. If you've ever been there, anything's worth a try.
Tivo for the soul - Could this be the ultimate form of meditation? Stay awake for only short slices of life and jump WAY into the future. Would it give you a different perspective? Would you dream? Would it matter?
Anyway, you get the idea. The point is, there are LOTS of possibilities not being effectively promoted. Feel free to ad yours below. These examples are why it's so important to know...
H2S Induced Hibernation useful?
It's been a YEAR!
Clue us in.
Or is everyone, "No Longer Sleepless in Seattle" ?
BTW, amazing work Mark. Congratulations.
01-20-16 Being frozen ‘to death’ saved this man’s life. It could save others,’ too.
06-21-15 The role of endogenous H2S production during hibernation and forced hypothermia: towards safe cooling and rewarming in clinical practice
Apparently "Torpor" is the new handle for this technology:
Mass extinction is a great reason to hibernate:
In this case, documents were revealed from a Naval Surgeon in 1805. The headline is about "Bizarre naval experiments" and the focus is tobacco smoke and deliberate transmission of venereal disease, when the real story is quite probably the first documented case of suspended animation.
When will they ever "get it"?
04-21-10 Significant advancement and recognition for the concept of induced hibernation!
I revisit this topic each year. It appears there's been significant progress. Look through my list of uses below to understand why, and how important this discovery is. Or start with Mark Roth's latest TED video at the end of the post.
Another major update 02-18-10 - Wired Interview