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CME Housing Futures: disappointment or impatience?


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2006 Jul 10, 3:58pm   26,998 views  248 comments

by Randy H   ➕follow (0)   💰tip   ignore  

Housing Futures

We anticipated the Chicago Mercantile Exchange housing futures and options for months before the market launched. We theorized and debated what impact this market would have on everything from the housing market itself to home builders to mortgage lenders to home owners. We fantasized that someday home prices would be linked to the region's CSI housing index. We discussed ways we could become fabulously wealthy -- or at least a bit safer financially -- by using housing futures.

We even predicted that ETFs that would surely quickly follow in the wake of CME futures and options markets.

What happened? The market is fundamentally sound. It is technically sound. There should be enormous theoretical demand from hedgers and speculators alike. So, where are they?

--Randy H

(For those interested in deeper technical financial discussion, feel free to post here where I'm running a parallel discussion.)

#housing

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92   Peter P   2006 Jul 11, 11:03am  

alien, you should go to their webpage and see if you like the menu.

93   surfer-x   2006 Jul 11, 11:23am  

I have this horrible neighbor who is trying to sell his '63 Tbird and keeps lowering the price. The thing is if he would just be "neighborly" and let me sell my first I could get more money for me. Is there anything I can do?

94   surfer-x   2006 Jul 11, 11:23am  

-my
+mine

95   astrid   2006 Jul 11, 11:25am  

X,

Violence is not a solution... maybe a dead skunk or five?

96   Peter P   2006 Jul 11, 11:37am  

The thing is if he would just be “neighborly” and let me sell my first I could get more money for me. Is there anything I can do?

You should buy his at pre-reduction price. This way, you will have two pieces of classic automotive investment.

97   Different Sean   2006 Jul 11, 1:04pm  

Peter P Says:
Is greed morally neutral?

yes, that's the point. under analysis, there is no such thing as morality, only what we perceive to be moral. every instinct has evolved for a reason, some we are OK with, others we may dislike. the taboos around sexual behaviour and promiscuity, then, are also morally neutral.

nor is the housing boom 'immoral' in this view, it just is. which is very buddhist and dancing wu li masters.

'there is nothing either good or bad, but thinking makes it so'
william shakespeare

98   Different Sean   2006 Jul 11, 1:18pm  

bap said:
The stupid dude in the paper that was quoted as saying, “we need higher paying jobs” is a friggin loon. The jobs set the price for the area housing. NEVER EVER has it been the other way around.

this is exactly it -- the inflationary cycle. speculators push up housing for a killing, so the price of goods and services goes up next, and wage workers then have to agitate for higher wages to pay for both the housing AND goods and services. wages eventually equalise to housing costs and cost of living, and the only net thing that has happened is that the dollar has devalued itself -- in the long run. in the short run, everyone gets mightily pissed off at an unjust social contract. it's possible the economic history of the last 400 years has been determined by this process...

The other thing they said, “predatory lending” ……. and how it “effected blacks and minorities worse” …. watch the libs suck us dry helping those who tried to ride the cash wave and got popped.

and libs are to blame for the practices of predatory, primarily republican-voting bankers and lenders? follow the trail of cash, dude... the repubs have already been there and sucked them dry first with the products...

the blacks and minorities are in the bottom end of the housing market, and they are just trying to cement some social security for their families, and who can blame them -- they are not the ones specuvesting...

This is so friggin stupid….. it’s like the Twilight Zone, man. Right is wrong, good is bad, queer is normal, lazy is productive …

yes, and libs are republicans, apparently...

99   Different Sean   2006 Jul 11, 1:30pm  

Free markets merely acknowledge and harness our natural greedy instincts. The alternatives (communism, social-ism, utopianism) attempt to deny human nature in the hopes of making it better or different.

man lived in a state of relative co-operation and 'primitive communism' (Durkheim and Marx) for 200,000 years before the last, most recent 10,000 years of 'civilisation', social stratification, commodification, etc...

is it really human nature to be consistently and continually greedy, or is it being exaggerated and exacerbated by enculturation? in the state of nature, is the greed balanced by altruism? and what motivates bill gates?

100   Peter P   2006 Jul 11, 1:56pm  

and what motivates bill gates?

The desire to make this a better world?

101   smb_gaiden   2006 Jul 11, 2:31pm  

Cell Phone Screens

How about some little browsing activity on the road and Wireless USB connection to a LCD monitor/tv for full sized display? This could occur while the phone is on a docking station, unless they've invented wireless electricity ;)

Anyway, I am in the industry also and agree about cell phones being PDA and Laptop replacement items. I see this as more so for the third world countries. Having this view on the future of computing, the new tablet PC or Nokia's browser device leave me confused.

The way I view computing is (Sizing Order):

Cell Phone -> PDA -> Tablet PC -> Laptop PC -> Desktop PC -> Server PC

I do not understand why they inserted an item between PDA and Laptop. I suspect it may have to do with the PDA OS Application support and usability is lagging, so Tablet gets the freedom to run XP and their same apps.

As for backing up, I suspect when people use devices for more information storage rather than sync the market will be created for cellphone backup units and software (for those with PCs). Otherwise, a simple backup to a home media center harddrive over wireless USB would suffice.

102   surfer-x   2006 Jul 11, 3:06pm  

Boomer to Surfer-X: "I am going to set up a surface science lab in my garage"

Surfer-X to boomer: "where are you going to get the money"

Boomer to Surfer-X: "the equity in my house".

Nice.

103   Michael Holliday   2006 Jul 11, 3:12pm  

Bap33 Says:

"...it’s like the Twilight Zone, man. Right is wrong, good is bad, queer is normal, lazy is productive … up is down …. chicks want to be dudes and vise versa …… the whole world is bassackwards."
_____

That's California!

104   Mike/a.k.a.Sage   2006 Jul 11, 3:31pm  

Do the CME Housing Futures contracts actually buy hard real estate assets? I know that when you buy pork belly futures or oil futures, you are actually buying those hard assets. Could someone explain to me what you actually get when you buy housing futures contracts.

105   Randy H   2006 Jul 11, 3:42pm  

Do the CME Housing Futures contracts actually buy hard real estate assets? I know that when you buy pork belly futures or oil futures, you are actually buying those hard assets. Could someone explain to me what you actually get when you buy housing futures contracts.

"No" and "no you're not", or at least not usually.

CME Housing Futures (and options) are based on the Case Shiller Index, a methodology for determining same-house price movements within a region, then moving average to an index. The method is transparent, you can read about it on the CME site.

When you buy pork belly futures you are not buying the actually pork belly. You are buying a contract that gives you the right to assign a responsibility to deliver physical pork bellies to you in the future. The contract has value, which is linked to the underlying value of the pork. But, 99.9% of the time you have no intent of actually collecting the pork; instead you settle in cash. In fact, some futures don't let you take delivery; but most will let you take deliver, but under pretty difficult physical constraints.

The reason hedgers do this (like farmers) is so that they can offset price movement risk by putting their pork "in play" before it's ready. Similarly, a big consumer of pork, like a restaurant chain, would want to stabilize prices going forward so they'll by those futures from the farmer. They both benefit from the trade even though they never transact any pork, only cash, assuming they have both hedged to reduce their price risk.

106   Mike/a.k.a.Sage   2006 Jul 11, 4:16pm  

Randy H,

Thanks, I'll do a little more research, but I'm still confused.

I know that I don't actually take delivery of the pork or oil, but actually sell it at a future date to someone who does. What is someone taking delivery of when they sell a housing futures contract, and where did the initial asset come from to buy or sell?

107   Different Sean   2006 Jul 11, 4:21pm  

you might have to take delivery of a house...

108   Different Sean   2006 Jul 11, 4:45pm  

bill gates, then and now:

then:

LILLL Says:
and what motivates bill gates?
perhaps…inspiration??? Just a guess.

maybe business inspiration... apparently he didn't write anything much of the CPM/DOS that he sold to IBM to start the mega-rich cycle, he paid someone else $50K for it... so just an entrepreneur with a clever licensing strategy. everything after that has been building a business and paying programmers. and we all know there were technically superior GUI OSs for Intel chips around in the Win 1, 2 and 3 years... further, he nicked the apple OS interface and got sued for it, and was saved by the fact that copyright and design law didn't include 'look and feel' issues, just source code... not to mention predatory behaviour in the past with a lot of broken promises to 'partners' -- he would promise a deal and get close enough to learn the technology, then pull the rug away and develop it himself...

in 1975, bill's company had written a port of the BASIC programming language (previously seen on other machines, and which bill neither designed nor paid royalties for the use of) and this software, retailing at over $600 in 1975, was freely traded among the different computer owners, since, well, six hundred dollars is a lot of fucking money. this drove the young gates ballistic, and in that year he fired off what became known as "The Letter", or "An Open Letter to Hobbyists", in which he decried this outward theft of his (ported, design-lifted) product.

apple actually had a 5 year run on microsoft in delivering its GUI OS, between 81 and 86 -- if they had ported the interface to the IBM machine, they could potentially be Microsoft now... but they were closed system and a bundled hardware and software solution all the way, with consequently low sales...

now:

Peter P Says:
and what motivates bill gates?

The desire to make this a better world?

now it's philanthropy all the way. well, he'll keep 20 billion and give away 20 billion. should JUST leave enough to live off... but the research is all good, altho there are numerous drug companies already developing anti-virals and vaccines for HIV, and for a host of other viruses. you have to make sure the countries being benefited aren't just the Microsoft software mill ones, also...

e.g. apparently the SAP guy in germany sold all his stuff, gave away the business profits, and lives in a cardboard house...

ditto warren buffett... just as well...

discuss, with reference to maslow's hierarchy of needs and marx's 'primitive communism'. was hobbes right when in the 17th century he described the life of the savage in the state of nature as 'solitary, nasty, brutish and short'?

109   Mike/a.k.a.Sage   2006 Jul 11, 4:51pm  

Bap33,

"Mike, I think it really should be called Mexifornia, land of Mexifornicating"

I think the correct term would be, Mexifornacation.

110   GallopingCheetah   2006 Jul 11, 5:49pm  

Bill Gates is the sharpest man I've met at MSFT and the entire computer industry. The man's worth the money he's made.

111   Mike/a.k.a.Sage   2006 Jul 11, 5:59pm  

Nobodies worth that kind of money except God. Gates and Buffet are avoiding paying taxes by putting their excess money in trusts. Who looses? American tax payers.

112   Glen   2006 Jul 11, 6:04pm  

DS said:
man lived in a state of relative co-operation and ‘primitive communism’ (Durkheim and Marx) for 200,000 years before the last, most recent 10,000 years of ‘civilisation’, social stratification, commodification, etc…

Sounds like the myth of the 'noble savage.' Primitive peoples cooperated only when resources were plentiful. When salubrious conditions prevailed, populations would grow to the point of unsustainability. Then, whenever there were shortages of food, water or other vital resources, warring tribes would kill and maim one another with rocks and pointy sticks. They were no better (or, frankly, no worse) than modern humans--greedy, selfish and self-interested (undoubtedly with a few nice qualities as well).

113   astrid   2006 Jul 11, 6:10pm  

Maybe a little historical perspective would help. What do you guys think of the Carnegie and the Rockerfellers?

Mike,

Once a person's networth gets above $5 million and if they're not totally stupid, financial planning gets driven by tax planning. Practically all billionaires and near billionaires shelter their money from tax, by trusts and borrowing money to avoid taxable recognition events.

I haven't checked out the Gates's rate of distribution. Are they going to burn through the money fast or are they going to be another one of those charitable foundations that lasts forever and have great grandkids overseeing the board?

114   Different Sean   2006 Jul 11, 7:45pm  

Glen said:
Sounds like the myth of the ‘noble savage.’ Primitive peoples cooperated only when resources were plentiful. When salubrious conditions prevailed, populations would grow to the point of unsustainability. Then, whenever there were shortages of food, water or other vital resources, warring tribes would kill and maim one another with rocks and pointy sticks. They were no better (or, frankly, no worse) than modern humans–greedy, selfish and self-interested (undoubtedly with a few nice qualities as well).

not true. you are conflating different periods of history, different forms of social organisation, and probably mixing in some episodes of conan the barbarian and xena the warrior princess.

population densities were very low, and people lived a 'hunter gatherer' lifestyle for most of that time, prior to horticulture and domestication of animals and plants, roaming in nomadic tribes, clans or bands, normally within an area defined by other tribes' boundaries. competition for resources was not that intense because of the low densities. disputes broke out for other reasons, however, often due to accusations of 'witchcraft' for want of a better word. anything unfortunate that happened was usually attributed to witchcraft from another tribe, a common form of superstition seen right through to the 17th century in europe. people were assumed to possess some sort of tribal magic in these animistic belief systems. some of the main living examples of this type of social organisation are the australian aboriginals, new guinea highlanders and amazon basin 'indian' tribes. intertribal warfare ends up being more of a sport and proclamation of status and territory, and casualties are normally extremely limited.

when my anthropology professor visited the new guinea highlands, they assumed he possessed some sort of 'football magic' since he was a white westerner, and that he would help them win their games just by being there, although he was actually completely useless at the game.

property is held in common inside each tribe, and you receive the use of something just by asking for it. the other is obligated to give it, and 'private property' does not exist as a concept, particularly hunting spears, etc. even today, westernised aboriginals in the same family ask each other for things, e.g. blankets, heaters, furniture, and they know they have to hand it over. this is where emile durkheim actually studied tribes' patterns directly in formulating sociology theory, apart from all the other anthropologists out there.

please indicate your sources of information if you dispute this, particularly claims of overpopulation and selfishness vs mutual reciprocity. i would begin by researching estimates of world population over time as a starting point.

you are actually using the older, discredited hobbesian notion or assumption or 'thought experiment' of what savage life must have been like from the 17th century as a philosophical assumption in forming social contract theory, and then magically woven in overpopulation to thepicture for good measure like they were a bunch of high breeding rabbits. the 'noble savage' conception actually came about as a corrective as colonialists and explorers starting invading places and realised everyone had reached a stable social settlement no matter how 'primitive'.

consider the state in which the north american 'indian' tribes were discovered -- they do not fit your description at all, and had reasonably sophisticated horticulture while maintaining tribal kinship or band societies with low population densities in a synergy with the land. i think you insult their memory and harmony with the land, in fact, and they were generally not 'acquisitive' with the possible exception of potlatches as an artifact of the 'big man' society. more on that in another free internet college lesson...

115   Different Sean   2006 Jul 11, 8:04pm  

I haven’t checked out the Gates’s rate of distribution. Are they going to burn through the money fast or are they going to be another one of those charitable foundations that lasts forever and have great grandkids overseeing the board?

i believe buffet and gates are donating significant shareholdings to the foundation, and continuing investing monies, which means there will be a constant profit flow into those foundations, rather than into their bank accounts...

tax dodge? maybe -- others do it. but i think they've realised they can't take it with them, that you can't possibly spend billions of dollars on yourself, that you need very little to live, and if you read interviews with buffett, he is very down to earth, is not narcissistic, and quite modest about his 'born ability to allocate capital', as he puts it. like george soros, quite a progressive intellectual in fact. vs the average sort of greedy republican nob doing reasonably well who resembles the pointy-haired manager from dilbert. i think the research and global reach will be worth it, and i don't think it's a tax dodge, gates and buffett have had decades to come up with tax dodges. (monies of that order get fed into corporate structures anyway, they only pay income tax on what they draw down and use...)

as for GC's remarks that somebody bright is intrinsically worth $40 bn of YOUR money, that's highly debatable in terms of overall social good. even gates' own father has published a book saying estates like that should be highly taxed, and that accumulating vast fortunes are just a freak of modern property law and the way assets are protected.

116   GallopingCheetah   2006 Jul 11, 8:20pm  

Well, I wasn't making a quantitative assertion. What I really meant is that Gates wasn't just a lucky guy. He is ASTUTE. I said he was sharp. I didn't say he was bright. That term is reserved for, uh, "bright" students. There are a lot of supposedly bright people. But they don't make good businessmen.

C'mon, the guy's brought great good to the PC industry. Without him, there probably won't be a Microsoft, there probably won't be an affordable PC for everyone and there probably won't be a Netscape revolution.

Another real reason why I defend Gates and other rich people is that because I fucking believe I'm worth at least 10 bil, if not more.

117   astrid   2006 Jul 11, 8:25pm  

Glen,

Since I don't want to get into another endless discussion with DS (really dizzying), I'll just bring up this point that partially supports your assertion. There's a big difference between property concepts in kinship groups and property concept in larger groups.

One obvious example to me is the effectiveness of people's communes in China. Mao's elimination of property ownership lead to major production drop offs that partially contributed to a massive nationwide famine in the late 50s/early 60s that killed upwards of 30 million people. The cooler heads were able to prevail temporarily and take measures to increase production, via decreasing the size of groups that share production (from equal distribution amongst 50K people to equal distribution in groups of 50 to 500). So while these people did not "own" individually, they continue to exercise a property interest.

The idea that people do not take property interest in their surroundings, and when pressed will die to defend those interests, is patently absurd. The native americans didn't just surrender the land to the white men for beads, they found long and hard, by words and deeds. They may not understand their property interest as specific land holdings, but they certainly fought back when their right to use of land was taken away.

118   astrid   2006 Jul 11, 8:35pm  

Most self made billionaires and near billionaires are highly astute people. And often quite charitable. The Carnegies and the Rockerfellers' industrial practices are debateable (though not obviously bad, in retrospect) but they've made lasting contributions to American society. (the Waltons, on the other hand, are social leeches and their charity choices suck)

I don't think much of MS software though, but I prefer a software based monopoly to a hardware based monopoly envisioned by Jobs. I just wish MS would crank out some good code, google and mozilla definitely seem to have the edge right now.

GC, what would you do with those billions if you got hold of them?

119   astrid   2006 Jul 11, 8:51pm  

Glen,

PS, I did noticed that DS didn't actually refute your observation at all, he just went into some other tangent. Then said that Hobbes's basic construction was clearly discredited, without bothering to cite who had so clearly discredited it. Also, I didn't really see the Hobbesian spin in your original comment.

My own spin is: If one goes by Collapse, there's a tendency of overcrowded primitive societies to become more rigidly hierarchical and oppressive. I posit that this transformation occurs because scarcity leads to more property crime and the larger social gatherings make the individual members less altruistic to the entire society.

120   DinOR   2006 Jul 11, 11:57pm  

Bap33,

Right on! Oregon I believe is the 2nd or 3rd least "ethnically diverse" state in the Union (after Idaho and Vermont?) and uh, we have PLENTY of predatory lending and toxic loans to go around! But I don't believe this is necessarily a lib/con issue. It's an FB issue. Remember, when it comes to mortgage brokers (and their fees) FB's "know no color".

This is a time for FB's of ALL races, colors and creeds to come together, set aside their racial differences and figure out how to get someone else to help pay for their equity extraction scheme!

121   edvard   2006 Jul 12, 12:20am  

Looks like "Boycott housing" made it onto the nightly news last night. Looky here: http://abclocal.go.com/kgo/story?section=assignment_7&id=4356937

In other news, I read in the paper last week that a housing activist group in Pleasanton is thinking of sueing the city over a ban on affordable housing: Here's the link: http://www.publicadvocates.org/

So... it looks like the poltical activism energy might finally have caught on and is now taking the issue of housing on the band wagon. Hopefully, there will be more of this kind of public outcry in the future.

122   Different Sean   2006 Jul 12, 1:26am  

C’mon, the guy’s brought great good to the PC industry. Without him, there probably won’t be a Microsoft, there probably won’t be an affordable PC for everyone and there probably won’t be a Netscape revolution.

bill gates has always lead technically from behind. DOS was taken from CPM (not written by gates), was a pretty hopeless OS, more just a non-reentrant interrupt handler, nowhere near as powerful as Unix or Linux, BASIC had been around since the 60s (he just did a port), and finally he copied the Mac interface some 5 years later and got sued. his main strength was massive sales and clever licensing. it always took to at least version 3 before his products were any good.

while windows 1, 2 and 3 and the mac os were all co-operative multi-taskers with swapping, and windows needed a minimum 80286, there was another GUI product that ran on an XT 8088 with 640K RAM and tiny HDD (slowly), worked well with most hardware, was as easy to use as windows 98 was much later, was a proper preemptive multi-tasker with paging, had advanced user interface features and threaded menus, high quality dot-matrix printing and ease of setup, etc, some of which windows doesn't even do today. all for about $200, including a built-in wordprocessor and spreadsheet. it sank without trace. but a much more 'affordable' solution for a PC and much more user friendly and robust than windoze. a team of programmers had created the technically perfect and cheap OS for much less than M$.

a world without microsoft wouldn't be a bad thing, there could be a lot more choice of products out there, and his practices were often aggressive and predatory. Netscape was an NCSA project, nothing to do with M$.

Another real reason why I defend Gates and other rich people is that because I fucking believe I’m worth at least 10 bil, if not more.

well, we all are, of course...

123   edvard   2006 Jul 12, 1:38am  

My thoughts on PCs: I've owned both Mac and PC. I used to be a fervent Mac guy. Apple definantly has a better UI. The problem is A: their computers are damned expensive. B: You cannot easily modify the guts of a mac. They're mostly permenently manufactored. Lastly, there simply isn't the variety of hardware and software available for Macs. A video card for a Mac is at least double of that for a PC. If you go PC, all you have to do is find some ugly metal box- even one thrown away- strip out the guts and buy a bunch of over the counter parts and bingo! Instant computer! I like the fact that you have more options with a PC. I on both and like the PC better, but will admit that my PC is pretty ugly.

124   Glen   2006 Jul 12, 1:38am  

Astrid said:

PS, I did noticed that DS didn’t actually refute your observation at all, he just went into some other tangent.

He seems to do this a lot.

My own spin is: If one goes by Collapse, there’s a tendency of overcrowded primitive societies to become more rigidly hierarchical and oppressive. I posit that this transformation occurs because scarcity leads to more property crime and the larger social gatherings make the individual members less altruistic to the entire society.

My "source," for DS's purposes, was also Jared Diamond, filtered through my own understanding of human behavior--I have only read a few chapters of Collapse, but GG&S was excellent and also contained a lucid discussion of the lives of primitive peoples.

DS:
The idea that primitive cultures did not experience scarcity is so absurd it is not even worth discussing. But even if true, it would mean that we could not emulate their purported carefree cooperative lives even if we wanted to. Unless, of course, you mean to suggest that we do not experience scarcity in the modern world. (Which would be an even more absurd claim.)

Perhaps in a primitive culture with unlimited untapped resources, a communitarian ideology could succeed as a method of social organization. Outside of that context, though, communitarian ideologies simply don't work. (Ever heard of the "tragedy of the commons"?)

125   Different Sean   2006 Jul 12, 1:48am  

astrid Says:
PS, I did noticed that DS didn’t actually refute your observation at all, he just went into some other tangent.

oh dear, have i not met your expectations again...

Then said that Hobbes’s basic construction was clearly discredited, without bothering to cite who had so clearly discredited it. Also, I didn’t really see the Hobbesian spin in your original comment.

everyone has discredited it. it's gone the way of the scientific debates about whether worms are generated from the air from the 16th century, which was the big debate of its time. it's like the flat earth has been discredited. it's like the theory of the aether has been discredited, and the plum pudding atom. why i have to reference the bleeding obvious is beyond me. once the anthropological and archaelogical evidence came in, and people started doing more research on simple pre-state societies, hobbes was realised to be conducting a thought experiment. he was operating essentially in pre-colonial and pre-scientific times. bit like the 4,000 year old earth was refuted by geologists, biologists, and physicists all at once -- which geologist was it?

"Earlier notions of abiogenesis, long discarded by science, are now more commonly known as spontaneous generation, held that living organisms are generated by decaying organic substances, e.g. that mice spontaneously appear in stored grain or maggots spontaneously appear in meat."
http://en.wikipedia.org/wiki/User:Extremophile/Abiogenesis

"Hobbes's view was challenged in the eighteenth century by Jean-Jacques Rousseau, who claimed that Hobbes was taking socialized persons and simply imagining them living outside of the society they were raised in. He affirmed instead that people were born neither good nor bad; men knew neither vice nor virtue since they had almost no dealings with each other. Their bad habits are the products of civilization specifically social hierarchies, property, and markets."

there, rousseau first challenged it, not counting all the anthropologists of the last 200 years who would also challenge it based on all the anthropological and archaelogical evidence, and throwing off the veil of their own culture.

My own spin is: If one goes by Collapse, there’s a tendency of overcrowded primitive societies to become more rigidly hierarchical and oppressive. I posit that this transformation occurs because scarcity leads to more property crime and the larger social gatherings make the individual members less altruistic to the entire society.

which 'primitive' societies, exactly? there is no such thing as property crime in primitive societies which don't possess property. man was pre-horticultural for 200,000 years. 'crime' suddenly appeared in horticultural societies once a surplus had been created, as it is easier to nick someone else's produce than grow your own. it seems that things like theft started to occur once horticultural societies evolved, which took a very long time to occur in the scale of human history. then there are agricultural societies, involving widespread domestication of animal and plant species. following from this trend seemed to occur the explosion of 'civilisation' abotu 10,000 years ago, which created massive surpluses. so we are talking about many different types of society.

i think astrid is trying to bait me to get that semester's worth of liberal arts training ;) i'll give you list of recommmended reading...

126   Different Sean   2006 Jul 12, 1:57am  

My own spin is: If one goes by Collapse, there’s a tendency of overcrowded primitive societies to become more rigidly hierarchical and oppressive. I posit that this transformation occurs because scarcity leads to more property crime and the larger social gatherings make the individual members less altruistic to the entire society.

the normal state of man in pre-horticultural societies is to group in kinship-based tribes, clans, and bands. they generally aren't hierarchical to any extent at all -- that is an artifact of much more advanced societies usually involving villages, towns and cities. when colonial powers went forth and would say to locals 'take me to your chief' they would be confused, as they often had no chief -- hierarchy came much later in terms of social evolution. sometimes the british etc more or less forced someone to be chief when it had no meaning to them, so the british could somehow relate to them.

oh, i give up, you don't seem to have read the observations on tribal life whatsoever, nothing on population densities, nothing on types of society, the advent of 'civilisation', etc... just get a 1st year college social anthropology textbook and have a read.... it's just an exercise in frustration.... 'collapse' is a work in pop anthropology -- not that many early societies were under population pressure at all... you are projecting your understandings of your own society onto totally different kinds of society, and it ain't gonna work... thank god i got a free university education instead of having to do business studies to pay back the loans...

127   Different Sean   2006 Jul 12, 1:59am  

Unless, of course, you mean to suggest that we do not experience scarcity in the modern world. (Which would be an even more absurd claim.)

scarcity of what? in your modern world? i assume you don't mean people living in the garbage mountain in manila. what are you short of? food? shelter? clothing? ridiculous. everything else is a luxury item...

128   Different Sean   2006 Jul 12, 2:02am  

the first chapter of every into textbook to anthropology discusses the low population densities and reproduction rates of simple hunter gatherer tribes that meant they could usually feed themselves reliably with about 3 hours work a day, especially when world population was low. that was my first point, which you haven't bothered looking up yet. let's just leave it as a research challenge for you to confirm or refute the other observations, instead of just whining.

129   Different Sean   2006 Jul 12, 2:02am  

how about those CME housing futures....

130   Glen   2006 Jul 12, 3:02am  

DS said:
scarcity of what? in your modern world? i assume you don’t mean people living in the garbage mountain in manila. what are you short of? food? shelter? clothing? ridiculous. everything else is a luxury item…

Everything is scarce. Otherwise, I wouldn't have to work to feed, house and clothe myself. I could just swing by my favorite restaurant and order a complete meal--free! I could fill my closet with clothes--free! My landlord wouldn't charge me rent! Where do I sign up for this world of abundance?? As for "luxuries" I suppose you mean things like cars, telephones, computers, plane trips, etc... These items may not be strictly necessary, from a survival standpoint. But they are kind of nice to have.

I suppose in your ideal world we would all be rounded up (kulakh style) and forced to be farmers, builders and weavers. No one could have a horse, let alone a car, or a phone, or take a vacation. On the production side, we will need to come up with a way of ensuring that farmers grow enough food for everybody, builders build enough housing units and weavers make enough clothes. Hard to do without some kind of oppressive, authoritarian central government. Then we should entrust our centralized beurocracy to handle the distribution side in a fair, impartial and inarguably "even" way. If you are lucky enough to be connected with one of these beaurocrats, maybe your allotment will include a spanish style home on a .25 acre standard-issue lot in Marin with views of the ocean. Of course, you may end up in a poorly built s*box in Modesto. But I'm sure our wise leaders can solve any perceived inequities without a problem...

The beaurocrats will also get to decide who gets the sushi and who gets the peanut butter. But never mind, I'm sure they will be wise and judicious enough to treat us all "equally." Or maybe, in this fantasy world, all food will be homegrown--so no sushi or peanut butter. Because you can't make sushi without fish *and* rice and most of the standard issue plots will not have a source of fish *and* a local rice patty. So we will all be eating home grown produce from our own gardens. But god forbid we attempt to trade some of our extra potatoes for an extra chicken or two! We might actually make a "profit" (based on some beaurocrat's determination of the FMV of said items) and that would be exploitative!

Even if your fantasy of utopian pre-horticultural societies were true, we could not go back to such a lifestyle in the modern world. In a world of 6 billion people we could not feed, shelter or clothe everyone without advanced forms of social organization. Any attempt to do so would quickly degenerate into a war of all against all. So how should we allocate resources? In socialistic societies (eg: Cuba) resources are distributed (roughly) evenly, as a result, no surplus is generated and everyone is poor. In capitalistic societies (eg: US) resources are allocated (roughly) to those who generate the most surplus, as a result some people are poor and some people are rich. I'll take the latter.

131   DinOR   2006 Jul 12, 3:02am  

newsfreak,

Just visiting over on Ben's and they were featuring a major story about the Lehigh Valley in PA! It's become quite dreary actually.

"Things were soooo good just this time last year"

"We invite a more level playing field between buyers and sellers"

"Days on Market have increased from a few days at the longest to several months"

"No one could have predicted this happening" etc. etc.

Uh, I'm no expert in "criminal psychology" but any time someone gets stabbed 20 times there's more involved than just money. IMHO.

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