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Guest Post: Beware Of Extrapolating Trends

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Tue, 03/29/2011 - 12:46 | 1113209 carbonmutant
carbonmutant's picture

Tulips...

Tue, 03/29/2011 - 13:11 | 1113303 Harlequin001
Harlequin001's picture

Nah, they'll never catch on...

Tue, 03/29/2011 - 14:58 | 1113744 YouBetYourLife
YouBetYourLife's picture

Ben won't be happy until it's threelips . . . fourlips . . .

Tue, 03/29/2011 - 15:51 | 1113962 nkktwotwozero
nkktwotwozero's picture

Treasuries...

Muni's....

TBTF's...

USDs...

Tue, 03/29/2011 - 12:46 | 1113214 John Law Lives
Tue, 03/29/2011 - 13:08 | 1113293 DosZap
DosZap's picture

On the Mortality issue, we spend untold amounts on Health Care, and yet the USA has the (may be off a tad), the distinction of being like #18 in life expectancy globally.(Yes, the Almighty USA).

In ALL the states with highest health care issues, the people are more obese, have the most diabetes per capita,health care issues, and lowest income levels compared to the rest of the states.

Why is this?, easy..............when you are borderline poverty level you are forced to eat the worst foods, and they are always the least expensive.

Tue, 03/29/2011 - 13:09 | 1113299 spinone
spinone's picture

Its because unlike other countries, we have for-profit healthcare.

Tue, 03/29/2011 - 13:33 | 1113379 traderjoe
traderjoe's picture

In collusion, partly through the revolving door of regulators/corporations, with the mega-agribusinesses...

Tue, 03/29/2011 - 13:48 | 1113450 ceilidh_trail
ceilidh_trail's picture

Uh, spinone- try spinning another. I have spent 30+ years in health care and will tell you flat out you are wrong. People who come to my unit are typically the sickest of the sick. Sometimes we work miracles, but many times we cannot- most of the time due to what these persons did/didn't do to keep their health prior to ever entering the health system. You think you can do a better job? Try lugging on a 500lb blob just for basic care such as bathing, turning, etc- let alone trying to get a deep line in someone who is so damn fat the needle isn't long enough to reach the vein (3" needle). Trauma- stupid people shooting/knifing/clubbing each other, idiot car crashes, electrocuted copper wire/plumbing thieves, blahblahblah... Smoking, drug/alcohol abuse, unprotected sex, poor diets leading to cardiovascular disease, on and on it goes. Lots of reasons for bad morbidity/mortality statistics in the USA, oftentimes these people croak before they ever touch the healthcare system. It's not so simple to just blame "greedy" providers. The blame is usually on the individual making stupid life altering choices...

Tue, 03/29/2011 - 14:06 | 1113533 Buckaroo Banzai
Buckaroo Banzai's picture

People make poor health choices in this country, and that's definitely their fault, but to be fair the entire system is stacked against them in this country. Big Pharma and Big Agriculture flat-out OWNS the CONgress, and in a demonic public-private partnership they literally produce mountains of poisonous shit that people actually voluntarily put in their bodies. Say's law--possibly the greatest single economic rule of thumb ever conceived-- states that supply always creates its own demand, and this is a perfect example of what happens when you jam a gigantic river of shit into the food distribution and morbidity-care delivery systems. People consume it.

Tue, 03/29/2011 - 15:10 | 1113784 Cvillian
Cvillian's picture

+1

Get a handle on fat kids and we're on our way to fixing this broken system. Probably starts with educating them that food pyramid, etc are horrible lies.

Tue, 03/29/2011 - 14:59 | 1113751 IQ 145
IQ 145's picture

 We're having an epidemic of "stupidosis".

Tue, 03/29/2011 - 17:30 | 1114490 wisefool
wisefool's picture

give them tobacco and they wont be fat. give them contraception and we'll get a novel. give them fiat currency and we will get pure comedy gold.

Tue, 03/29/2011 - 20:08 | 1115048 saulysw
saulysw's picture

See further the movie "idiocracy"

http://www.imdb.com/title/tt0387808/

See this as a good primer on the problem...

http://www.youtube.com/watch?v=PSROlfR7WTo

Tue, 03/29/2011 - 14:07 | 1113531 tmosley
tmosley's picture

No, it is because unlike other countries which have socialized health care, we have fascist health care.

http://mises.org/daily/4276

Tue, 03/29/2011 - 18:11 | 1114674 JW n FL
JW n FL's picture

60% of those monies will be spent with Private Health Care Providers.. Thats why there was a $5 Billion Dollar Lobby for Universal Coverage.. when technically we had universal health care.. based on the fact Hospitals have to see you when you are sick.. whether you can pay or not.

Tue, 03/29/2011 - 18:48 | 1114786 greenbear
greenbear's picture

Superb article. 

I hate allopathic medicine.  That system killed my mil.  She believed doctors without question and that was a fatal mistake.  Because of elevated "cancer markers" they sliced and burned her for years.  The story is too long to tell so fast forward to the end. They zapped her femur with radiation so many times it just snapped under her weight and voila she was bed-ridden.  Then she got an infection from a cathater and died.  Between the doctors and the markets TPTB stole everything she and her deceased husband had saved over a lifetime.  Then when it was all gone they managed to kill her. 

Written by Luke (himself a physician):

Luke 8:43 And a woman having an issue of blood twelve years, which had spent all her living upon physicians, neither could be healed of any,

Not much has changed in 2,000 years.

Tue, 03/29/2011 - 14:22 | 1113594 RafterManFMJ
RafterManFMJ's picture

Very valid point. Have thought the same for many years...adding a profit motive obfuscates and drives up costs, as you have so many regulations.  What really screwed health care was making it a 'free' bennie during WWII.

Tue, 03/29/2011 - 13:39 | 1113402 Bicycle Repairman
Bicycle Repairman's picture

"when you are borderline poverty level you are forced to eat the worst foods, and they are always the least expensive."

There is some correlation there.  Perhaps another correlation is people on the poverty border line are less intelligent.  In today's food market the consumer has to exercise more care to avoid dietary pitfalls.  In days of yore the leadership would recognize this deficiency and protect people from "predators".  No longer.  Darwin rules, everybody.

Tue, 03/29/2011 - 14:20 | 1113590 barbarika
barbarika's picture

"when you are borderline poverty level you are forced to eat the worst foods, and they are always the least expensive."

The expensive part is certainly not true. Organic steelcut oat is $1.19 a pound at the neighbouring grocery store. Bananas are 49 cents a pound. Seasonal fruits sometimes go under 80 cents a pound. The problem with borderline poor is lack of knowledge/lack of accessibility, or more likely plain old laziness. As a grad student for five years living on $1200 a month, and sending 500 of it back home, i managed to stay pretty healthy, and everyone in this country can. Problem is the entitlement mentality, and the tendency to blame the other for self created ills. If people are forced to face conequences of their actions early by cutting welfare, maybe there will be some improvement.

Tue, 03/29/2011 - 20:14 | 1115062 Beatscape
Beatscape's picture

+1.  I spent years in my youth living on eggs, bananas, peanut butter (high in protein), broccoli, water (no milk or juice), apples, canned tuna and cottage cheese.  No one forces poor people to eat lousy food--they do it because they don't think for themselves or know any better.  Sure, you can blame mind altering advertising if you like, but people have to accept responsibility for their own actions.  I watched the same TV commercials, but rarely ever ate fast food. Plus, everyone knows when they are getting overweight.  I have zero sympathy for corpulent fatsoes that fully realize they are way over the line and endangering their health. Our instant gratification society has bred an army of sick corpulent beasts.

Tue, 03/29/2011 - 14:47 | 1113699 ElvisDog
ElvisDog's picture

Oh, bullshit. You are not "forced to eat the worst foods". People don't eat Big Macs and KFC because it is the cheapest food around. You could make a spaghetti dinner for four for less than $6.00 (1 lb pasta ~ $1.49. 1 bottle spaghetti sauce ~ $2.49 1 lb broccoli $1.49) which is less than you can feed a family of four for at Burger King. People buy fast food because it is relatively cheap, is convenient (no cooking), and is loaded with fat, salt, and sugar.

Tue, 03/29/2011 - 16:02 | 1114009 nkktwotwozero
nkktwotwozero's picture

>You are not "forced to eat the worst foods".

It's heavily subsidized.

The unhealthiest lifestyles are the most heavily subsidized in the US.

Driving everywhere is subsidized by huge highway building programs.

Detached single family home (aka, feeding through) and car (detachable room) become the cocoons of a horrendously unhealthy life of sitting and eating unhealthy foods.

Such as beef and dairy products; which due to the way the USDA's subsidies are set up, receive the bulk of subsidies.

This may have made sense in another day and age, but today, it does not.

 

And then people wonder how nearly half of 45+ year olds are obese.

It's because the lifestyle they lead is hideously unhealthy, and very heavily subsidized.

Tue, 03/29/2011 - 15:52 | 1113966 nkktwotwozero
nkktwotwozero's picture

Because US is too much "Care" and not enough "Health".

Tue, 03/29/2011 - 12:48 | 1113218 redpill
redpill's picture

Chuck Norris can continue to kick ass exponentially

Tue, 03/29/2011 - 12:56 | 1113259 Sudden Debt
Sudden Debt's picture

And when he starts to cry, politicians turn honest.

 

Tue, 03/29/2011 - 12:59 | 1113270 WALLST8MY8BALL
WALLST8MY8BALL's picture

Chuck Norris' tears could cure AIDS , but Chuck Norris never cries!

Tue, 03/29/2011 - 13:10 | 1113302 Harlequin001
Harlequin001's picture

doesn't act either...

Tue, 03/29/2011 - 13:13 | 1113311 redpill
redpill's picture

Why in the world would he pretend to be someone else?

Wed, 03/30/2011 - 03:58 | 1116132 Harlequin001
Harlequin001's picture

because that's what they do in the movies isn't it?

Well some of them anyway.

some of them evidently aren't very good at it...

like Steven Siegal who only plays Steven Siegal, and Charles Bronson who only ever plays Charles Bronson.

and Ben Bernanke who only ever plays Santa Claus...

and Obama, who only ever plays a complete fucking idiot.

Tue, 03/29/2011 - 12:46 | 1113219 WALLST8MY8BALL
WALLST8MY8BALL's picture

 USA USA USA WE ARE # 1. In your  face Norway!

Tue, 03/29/2011 - 12:52 | 1113243 Horatio Beanblower
Tue, 03/29/2011 - 15:52 | 1113974 wisefool
wisefool's picture

Yeah, good on norway that gives out prises for peace before the Loki is elected. (saved the z)

Tue, 03/29/2011 - 12:52 | 1113233 Mr Anderson
Mr Anderson's picture

The household credit market debt outstanding chart should scare the hell out of everyone.

First time in history its trending down- 

Things are definitely getting better, thanks Ben

Tue, 03/29/2011 - 13:14 | 1113308 Harlequin001
Harlequin001's picture

bullish, definately...

Tue, 03/29/2011 - 12:53 | 1113238 HelluvaEngineer
HelluvaEngineer's picture

Anyone getting a funny feeling this market's gonna sell off at the end of the day (again?)

Tue, 03/29/2011 - 12:51 | 1113240 DrDre
DrDre's picture

 

Great point. People just do not seem to understand the implications of extrapolation, or chose to ignore them. Perhaps it is a tangible sign of how bad the education system is?

When analysts say equities are cheap based on the most recent year's earnings, they are implicitly extrapolating 2010's unudual growth rate permanently into the future. 

We live in a world where lemming thrive and prosper. Extrapolation is their weapon.

 

 

Tue, 03/29/2011 - 13:07 | 1113291 NidStyles
NidStyles's picture

Rather than deriding them, I prefer to try and educate them. I do believe a lot of them are interested in learning after their lives were nearly wiped out in the last debacle.

Tue, 03/29/2011 - 20:00 | 1115027 suldog
suldog's picture

Outstanding vids on compounding, extrapolation ... if you haven't already seen them.

http://www.youtube.com/watch?v=F-QA2rkpBSY 

Tue, 03/29/2011 - 12:58 | 1113258 RobotTrader
RobotTrader's picture

Lazlo's view of stocks:

Tue, 03/29/2011 - 13:18 | 1113323 Harlequin001
Harlequin001's picture

What is Kermit up to these days, haven't seem him for years...

Not since the Muppet's, which was excruciatingly funny...

and a sight more interesting than CNBC...

Tue, 03/29/2011 - 13:29 | 1113368 John Law Lives
John Law Lives's picture

Kermit looks happy in this photo.  Who wouldn't be?

http://movies.msn.com/celebrities/celebrity-photos/kermit-the-frog.1/?ga...

Tue, 03/29/2011 - 13:50 | 1113462 ceilidh_trail
ceilidh_trail's picture

+500

Tue, 03/29/2011 - 14:09 | 1113536 web bot
web bot's picture

Ever since Ernie and Bert came out of the closet and Cookie Monster became Veggie Monster... he's been on meds... no wonder in this #uckin crazy world... we're even giving the Koolaid to kids now...

Tue, 03/29/2011 - 14:38 | 1113656 Josh Randall
Josh Randall's picture

Exactly - that Ruler theory of his had me RFLMAO. How many of his Teflon Twenty do you own ? 

Tue, 03/29/2011 - 12:59 | 1113271 Dinghy Dumper
Dinghy Dumper's picture

General phenomenon - any process that relies on F(x) = exp(x) and at some level/ultimately connects to mass & energy flow in a system will first seem to grow without bounds, then become chaotic and eventually catastrophically fail and crash.

True for drive shafts in engines, nuclear reactions, tumor growth in cancer, climate change and - of course - financial markets.

Enjoy the ride !

PS: Also true for the number of comments posted to any new Zero Hedge article

;-)

 

Tue, 03/29/2011 - 13:35 | 1113388 traderjoe
traderjoe's picture

The fundamental flaw of the "science" of economics is relying on infinite growth (a compounding growth curve). The bullshit science of economics, meet the laws of thermodynamics. 

Tue, 03/29/2011 - 16:46 | 1114303 css1971
css1971's picture

NOOOOOOOOOOO! The Singularity WILL happen!!!!

 

This is one of the reasons I despise banks, politicians and economists (oh and "futurologists".. WTF?). They are basing everything on extrapolating an infinitely expanding exponential function. Fucking muppets should be either sweeping streets or breaking rocks.

 

Tue, 03/29/2011 - 13:05 | 1113282 LeftCoastRefugee
LeftCoastRefugee's picture

lalalalalalala.....Can't hear you, market only goes up.....

Tue, 03/29/2011 - 13:04 | 1113283 Guarded Pessimist
Guarded Pessimist's picture

I am looking forward to Richard Heinberg's new book coming out soon called The End Of Growth.

I think we're pretty much there.

http://richardheinberg.com/bookshelf/the-end-of-growth-book

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