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markets vs hierarchies case


Awaiting sanctions…

A little humour from the web :-)medved 3

Herr Khodorkovsky, Cafe “Kastanienbaum” begrüßt Sie

Prematurely released (as the extension of his sentence was clearly being cooked up) Khodorkovsky found freedom in Germany… The situation reminds me of a chapter from 1984 where Winston remembers failed revolutionaries, pardoned by Big Brother and drowning in gin their last days of ‘freedom’ in the Chestnut Tree Cafe.  We know what follows.  /*

Once Wild

…is a play by Word Dance Theater this weekend, May 3 – May 5.  I was privileged to attend a rehearsal a few days ago.  This turned out to be fortuitous as I was immediately impressed by the inventive narrative of the revolutionary Russia in the early 1920s.  Outstanding choreography, live piano, Russian folk music and poetry create a long-lasting impression.

The central story is of an American-born originator of a new dance form – Isadora Duncan, told through her adopted daughter and student, Irma (shared by actress Kimberly Schraf and dancer Ingrid Zimmer).  Cynthia Word’s Isadora is in the photo below (courtesy of Word Dance Theater).WDT_OW_Passage1  So graceful, as if a live twin of Nike of Samothrace :-)

Isadora was not the first Westerner to travel to Soviet Russia hoping to find a better world.  One well-known example before her was John Reed, who produced an account of the Bolshevik revolution in Ten Days That Shook the World.  Within Russia, young intellectuals also hungrily rushed to embrace the revolution, only to become deeply disillusioned in the end.  Much of that talent met a tragic end.  Poet Sergei Esenin (played by Philip Fletcher), whose life became connected to Isadora’s for several short, or so it seems, years, was no exception.  Esenin together with Anatoli Marienhof and Vadim Shershenevich founded imaginist (derivative from “image”) circle, a new literary movement.  Their stories were told through images evoked by certain words and expressions.  Sometimes it meant combining words in an unusual way.  The group believed that, over time, words were tagged with extra meanings, so they set out to unearth the original.  Marienhof’s Novel without a Lie is a wonderful read and the most truthful portrait of Esenin.

IMG_3117To majority of Russians Esenin is still the ‘most Russian’ poet.  However, he will probably remain little understood outside his language culture because the work of an imaginist can hardly be translated close to the original.  Through my own struggle to find or even work on translations of some of my favourite poems (beyond imaginist circle too, but including Esenin’s contemporaries – Alexander Blok, Aleksander Mayakovsky), I realized that even if all the words are carefully interpreted and cultural references explained, the images and emotions produced in a mind of non-native Russian speaker would be different from the ones produced in a mind of a Russian.  Not wrong, just different.  The power of combining metaphors, allegories, even array of sounds that individual words produce together is weakened.  So then another interesting question arises: Can we ever fully appreciate something expressed in a foreign language in a foreign cultural environment?  This issue is similar to an economic one of inarticulate, tacit, knowledge, which is the knowledge of a particular time and place, learnt only by doing, and which cannot be taught to someone who has no experience of these circumstances.  And this is why the multi-disciplinary works of art like Once Wild deserve special attention.  When several forms of art come together to ‘embed’ the viewer in a volatile 1920s’ Soviet Russia and follow the lives of two extraordinary individuals, I think it greatly enhances our experience.

Philip Fletcher, who plays Sergei Esenin, never fails in any role, it seems.  Esenin-types, who awe us with talent and who we can adore and hate at the same time, are especially difficult to portray, but rewarding when done right.  Very moving and real person emerges as a result of Philip’s extraordinary effort, and that is Philip’s acting signature.


The cause of Berezovsky’s death

DSC_0053 …might remain “ungoogleable,” or undisclosed, to twist the new e-language.

This recent event in London has brought back the memories of the rise of Russia’s oligarchs in the 1990s, the shady Kremlin deals, the bloodbath of vice and corruption that followed...


This was written in March, although I held back from posting it for completely apolitical reasons, and where are we now?  Well, the press and the public has a short memory, indeed.  Let’s hope that the academics do better, at least a little bit.

Water Stage at Synetic

Synetic Theater has another specular show — Tempest (see website and trailer), which runs through March 24th.  The Shakespearean play set in water is a delight to watch.  The storm, the shipwreck, the creation of magic, not to mention the waterfall piano, which plays…. The first three rows get raincoats to keep dry, but mostly the first row gets in trouble.  This water play follows another memorable performance of King Arthur on a water stage several years ago.

To my knowledge, Synetic is the first theater in America to use water in their productions.   This was done before in the 1990s and 2000s, on a Russian (St Petersburg) stage in Lev Dodin’s Platonov, Chevengur, and Seagull, among others.  Also, quite interesting are productions by a Dresden-based group Derevo that used water in Ketzal, for instance.  Derevo, however, is a rather unique and complex concept, to say the least, and probably not for American mass consumption at this point in time.

In Dodin’s plays water creates an environment (as in a stifling atmosphere of fatality and emptiness, a black hole, a poisonous marsh and so on), but it is a part of a stationary landscape.  Derevo draws on water in a more holistic approach but the group has a very unusual concept of theater and way of living in general.  Synetic’s director, Paata Tsikurishvili, is doing something different and, in my opinion, very consequential for the American theater development.  Essentially, all three approaches can not be compared.  At Synetic, the action is embedded in water, and water itself is an actor.

Human :-) actors at Synetic are no less  amazing.  Philip Fletcher (Prospero) has wonderfully portrayed the noble wizard.  It is too bad one can’t change the plot of the play too much because I wish even more time were devoted to Prospero’s role, as Philip has a great presence on stage. He is a phenomenal actor, especially for physical theater because he combines grace, strength, and outstanding dramatic skills.

Philip has a very long list of awards and nominations, to name a few, for Iago (three-way split personality where Philip is one of three) in Othello, the portrayal of the Witch in Macbeth, and my absolute favourite — Behemoth — in Master and Margarita.

Now, the latter role deserves a separate note.  Master and Margarita by Bulgakov is quite a special novel to a lot of Russians.  Bulgakov’s black tom cat, one of the devil’s minions who so wittingly plays tricks on Soviet bureaucrats, is a stout fast-talking creature about a short man’s height.  Trouble-maker in extreme and a glutton, Behemoth, which in Russian means ‘hippo,’ walks on his hind legs and is entirely different from what I saw in Master and Margarita at Synetic.  Philip’s graceful, tall Abyssinian hooligan at first called a silent remark in my mind, ‘What in the world is this?’  It was almost like taking my favourite teddy bear away!  After a few minutes of sophisticated mischief by this new creature, I was not as disappointed, despite my initial fervent protest.  By the middle of the play (the scene in photo below), he won me over.

Apparently, many viewers had similar experience.  This could be worth much more than any awards.  When an actor can so successfully unmold a stereotype, it is a very big deal!

Philip is going to appear in another, Russia-related play soon, which warrants a post here later this month. /*


In the photo: Philip as Behemoth is in front.  On the right, Alex Mills as Azazello, in the back on stilts is Scott Brown as Koroviev.  To the left is Sarah Taurchini as Hella, and Armand Sindoni as Woland  in the middle.

A monument to Mr. Keynes

November 7 — the day of celebration of the Bolshevik Revolution in the USSR, magnificent parades in Red Square, leaders waving to the masses from the Mausoleum.  Ironically, this is the day on which we learn the result of the 2012 presidential elections in the US.

I agree with Charles Rowley’s view that the American exceptionalism is no more.

In particular, he writes:

“The Democratic Party makes one major error in quietly gloating over this transformation. Social market economics is not the monopoly jurisdiction of any single party. By 2014, the Republican Party will have adjusted to political reality. Mitt Romney was its last shot in support of American exceptionalism. Both parties henceforth will become social democratic in nature. And American exceptionalism will be a historical relic.”


From the Newseum

Synetic Theater’s Jekyll and Hyde — the wrath of the black swan

In your strangest dreams, could you imagine that Dr. Jekyll’s second identity is an ‘upside-down’ black swan? Synetic’s director, Paata Tsikurishvili, did.  Yep, Odile, but with a twist.

Humor aside, this is another superb production by Synetic, and note on this site is much overdue, as I have enjoyed their plays for almost three years now.  This is the trailer and one of the many reviews for Jekyll and Hyde.  Runs through October 21 in Crystal City and is highly recommended.

There is no reason to repeat all the positive aspects noted by the professional reviewers.  Alex Mills’ transforming Jekyll into Hyde is very vivid, elaborate, and unsettling.  Both the director’s vision and actor’s unique abilities make this an unforgettable experience for the viewer.  Alex Mills has performed with Synetic as Merlin in King Arthur, Puck in Midsummer Night’s Dream, Romeo in Romeo & Juliet, and an outstanding  Azazello in Master & Margarita – to name just a few roles.  However, Alex’s enormous dramatic potential shows even more in Jekyll/Hyde.

In their productions, Synetic always has the golden mix of a powerful moral statement and entertainment.  Ideally, here I would have preferred an even stronger message.  However, the director’s choice to blend a dose of humor into Dr. Jekyll-Mr. Hyde concoction might be right.  While arts carry both entertainment and ideological/educational function, in a consumer-oriented environment, at least part of the presentation is determined by the audience’s preferences.  Not to say that the play cannot try to re-educate the viewers or make them think deeper.  But if you scare everyone off by unsuitable to current tastes presentation, you won’t have anyone to educate.

The audience here clearly prefers at least some humor.  And this challenging task is skillfully achieved.  Transformed into a perverted black swan, Hyde is dehumanized into a creature, a humanoid thing.  This does send the right message that evil can be very liberating and there lies the danger.  But it also makes it easier to inject minor humorous elements into Hyde’s actions and take the edge off.   The black swan’s rampage would have been much more unnerving, had he retained more human features.  And we should probably thank Paata and Alex for not having taken the unsettling path.  There are a few good books that I cannot pick up again after reading once, as they were too disturbing.

In conclusion I would note outstanding work of the set designer, Daniel Pinha.  Also, Rebecca Hausman is an excellent new find for the theater.  I read that she played Masha in Chekhov’s Chaika.  I wish I could have seen that  — it seems to me she would be excellent in that role.

Personally, I very much enjoyed two unusual elements in Jekyll and Hyde: the gas masks and the black swan.  These reminded me of the two incongruent, yet essential elements of my Soviet past: civil defense exercises and arts, and made me feel quite at home :-). // *


Updated: American political scene is boring in comparison…

…with Russia’s.  Recently, in addition to summit in Vladivostok, the president attended to endangered species. Putin flew a hand-glider leading white cranes (sterkhi), who were bred in captivity, to their new wild habitat.  Putin was imitating their ‘bird leader,’ and at one point was even supposed to wear a beak.  There are very few birds left, and this effort is supposed to portray the president in a very humanistic light.

The Russian blogosphere, however, is laughing, saying the next thing will be the president leading salmon up the stream to lay eggs or that now in addition to secretary bird, we have ‘president bird.’  It is all very well for them to laugh; I can say that political scene in the U.S. is extremely dull in comparison to this.  You may not get much for your tax money, but at least in Russia, you get entertainment and help white cranes ;-)

But then there were amphorae in Black Sea, tigers, leopards too.  All PR.  I suppose it is a matter of a politician’s preference whether they grow cabbage in DC to promote healthy life style or frolick with leopards to raise awareness of endangered species.

What’s next for Russia?  A remake of Dr. Moreau’s island?


Ну а мы что, хуже стерхов? За Путиным, ребята!   // *

putin flies with cranes: Vladimir Putin takes part in an environmental project



There are lots of mean people and sad events in this world, but today none of that matters because CURIOSITY HAS LANDED!!!   // *

Trade deficit: How to beat China and other exporters

It is known that the U.S. has a very large trade deficit with China.  It appears to concern many.  But there is a perfect solution.  I have heard rumors :-) that Chinese labor is no longer as cheap as it used to be.  China has been a successful exporter, it has been growing, standards of living have been rising and so have the wages.  Now, companies start hunting for cheaper labor in other parts of the world (this is assuming that they are hunting the cheaper labor because skilled workers naturally cost more).  The solution is to stop worrying about beating China in export war, let it export away, which will raise standards of living and cost of labor in China even further, and maybe one day American labor will even become cheaper than the Chinese — well, anyway, theoretically speaking.  A little humor will do, as I do not really believe in wholesomeness of Chinese government that much.  At least not today.   // *

++++ Please see links in comment provided by Andrey.  These are an excellent edition to this topic.

In response to a comment — Soviet statistics, Russia’s modernization, and electricity usage map

I would like re-post here an insightful comment to The Economist post by Andrey:

“Достаточно взглянуть на достижения даже за последние 10 лет, все эти реформы оказываются обычным трепом и в лучшем случае откатом. В 1987 году Новосибирские экономисты, оценили реальное состояние в советской экономике на основе затрат электроэнергии. Все данные по выпуску продукции тогда были фальшивыми, во много раз завышенными. Но никто не фальсифицировал расход электричества, и на этой основе было доказано, что советская экономика не приболела, а издохла.

Оказалось, что расход энергии это надежный показатель производства. А поскольку вечером промышленность уменьшает потребление, то энергия перебрасывается на бытовой сектор и на освещение. Вот и видно все, как на ладони. Все успехи Сколкова и модернизации, “Назад в Архангельск” (послушайте Гребенщикова).”

The first link above is to a map, which  can be viewed on an English-language site here and description here.  It is a NASA project, which registers electricity usage and type in various parts of the world and shows growth or decline of human activity during a period of time.  This data has been used to draw conclusions of a country’s or region’s economic development.  It is the nighttime (consumer) usage that really gives an idea about the standard of living.

The second link is to an 1987 article on Soviet production and growth statistics.   It exposes the problems of accuracy in reporting and incentives or lack thereof :-)  In my own work I drew on the research by two outstanding U.S. scholars, Warren Nutter and Naum Jasny, who successfully battled the lack of information on the true state of the Soviet economy and inaccuracy of existing information in the 1950s-1960s.  In the light of the information released in the 2000s from the Soviet archives, it became evident that their conclusions were right on the mark.   This 1987 article with a very witty title has one interesting point.  While it is conventionally believed that the Soviet growth turned in the 1970s, it is not quite accurate.  The authors show it had happened a decade earlier.  The mitigating factor was… the price of oil.  Reminds of a recent situation, doesn’t it?  Here’s the direct quote:

“Заглянем в справочник “Внешняя торговля СССР в 1984 г.”. Из 74 миллиардов рублей годовой экспортной выручки 38 миллиардов (больше половины) получено за нефть и газ, в том числе 31 миллиард за нефть. Не будь этих денег, как страна покупала бы технику, хлеб, одежду, сахар? В 70-е годы ситуация была как раз благоприятной для нашего экономического развития. Исключительно благоприятной. Добыча нефти увеличивалась фантастически, цены на нее на мировом рынке пли круто вверх. Такого стечения обстоятельств, вероятно, больше уже не будет. Объективные трудности начинаются только теперь — добыча нефти стабилизировалась, увеличивать ее экспорт вряд ли удастся, а цены на мировом рынке упали в 3 раза. И, скажем, за тонну зерна сегодня надо отдавать три тонны нефти, хотя недавно меняли практически тонну на тонну. А покупная техника? В 1984 году ее приобрели на 24 миллиарда рублей. Это главная статья нашего импорта. Учтем, что не в пример нефти техника на мировом рынке дорожает. [195]”       // *

Romney’s riches: A Russian perspective

Romney refuses to put his riches at the center stage of the election campaign.  I wonder why.  Probably because he is quite affluent.  The truth is that either candidate cannot complain of being poor.  But somehow this makes Romney look richer.  The Russian perspective on this seems very sensible then:  the one who is richer, will experience diminishing marginal returns from additional wealth; therefore, is less likely to exploit his position for personal gain.  Who said Russians are bad economists?  // *

Survey result: Pessimistic economists

Just released, survey points to pessimism among majority of economists regarding near-term future.  Well, it is about time to recognize the fact.  There are a couple of possible explanations why it took  so long.  First, there is a certain lag in data collection and processing, and economists by nature  are wary of drawing premature conclusions.  Or that the majority surveyed now happened to be left-leaning economists.  In my experience, most free-marketers are more optimistic in general, while the left is dooms-day-coming.  I am afraid in that respect I do not conform :-).  // *

The Piggy Bank of EU

More European centralization is in the works:  Euro zone officials are devising a plan for the central bank.  This will allow banks to be bailed out directly, without going through the national governments.  So it seems that the crisis has not moved Europe in the direction of disintegration, but instead moving it in the direction of more centralized control.  The Fed was conceived in 1913; its European counterpart may come into existence a 100 years later.   // *

Turboprop vs. Jet

WSJ (July 9, 2012) reports that “Turboprop aircraft makers ATR and Bombardier are seeing orders swell as more carriers switch from jets.”  But the economics of this decision still is and will be muddled with regulations, and the final outcome is uncertain.  The switch to turboprop may be used as another example of economic decision making when a resource (fuel, in this case) becomes cost inefficient.  For more details on turboprop vs. jet, read here.  Currently the turboprop technology is more efficient for short routes and small airplanes, but the airlines apparently would like to see a larger size of aircraft.  General  Electric is looking to develop turboprop engines with greater efficiency.  // *

The Euro crisis has started: Garlic capital flees from Spain

That is way too funny.

“Austrian police said Wednesday they had stopped five Romanians on the motorway with overflowing lorries transporting a whopping 9.5 tonnes… of fresh garlic.

The five men, aged 25 to 37, could not explain where the pungent bulbs came from or prove the load belonged to them and were charged with transporting stolen goods, the police said in a statement.”

The garlic was on the way from Spain to Hungary.  News article here.   // *

Blue Ridge, VA

Blue Ridge, Skyline drive.

Who wrote this for The Economist???

This is a bad one for The Economist.  An outrageously bad one…

In May 26th issue, on p. 7, under the title “It’s my party”, it says:

“Russia’s president, Vladimir Putin, unveiled a government dominated by loyalists, tightening his grip on the economy and national security after popular protests.”

So far – ok, even though it comes as no surprise.  But then it continues:

“The new government is likely to curtail the ability of Dmitry Medvedev, the prime minister, to pursue market reforms.”

Where in the world has the author of these words been for the last decade?  Medvedev, Putin’s puppet, is the driver of market reforms?  Maybe The Economist is also saying that Medvedev fairly won the elections and was implementing market reforms while president?!

Mt Vernon

Gold prices

Gold prices have been on the rise recently, which is not surprising, given the uncertainty of fiat.

Here is an interesting article shared  with me by Reem, one of the bright bunch in Econ 310:  Abu Dhabi hotel ATM dispenses gold bars.   A German entrepreneur tried it first in his home country and apparently it was a success.  Can we import this please?

Additionally, this website looks like a good source on tracking precious metal prices.  Chart here tracks monthly price of gold from 1995 to 2012.


Oil Price Movements: A History Lesson

With oil prices rising again, this is an excellent historical review of oil price movements by James L. Williams.


Groundhog Day at the Fed

There are  many humorous ways to interpret the fact the Fed’s chairman testified today, in particular, the movie “Groundhog Day” comes to mind.

Ben Bernanke’s eloquent testimony is here.  Shadow or no shadow, but the rates are safe ;-) through 2014!


“Нам нужна новая экономика”: Denying protectionism and supporting competition as way forward, Putin still anti-Ricardian and anti-Smithian

The full-text article appeared in Vedomosti in Russian and abridged version in FT, in English.

The gist of Putin’s Russian-style “State of the Union” address is this:  “Готовы ли мы так сильно рисковать будущим России ради чистоты экономической теории?” which loosely translates as, “Are we ready to risk Russia’s future only to satisfy the postulates of [free-market] economic theory?”  Here Putin is defending some steps towards vertical integration and state control that his government exercised in the past.

It is apparent now that “privatize everything” approach does not work in Russia because free market institutions and the rule of law are not there.  However, historically, state control and state sponsored innovation have not produced the long-term growth to which Putin alludes.

Putin emphasizes development of new innovative technology and raising productivity, which echoes the recent rhetoric in the EuroZone.  Meaningless job creation and liquidity injections may only be a short-term solution and just do not make an economy more competitive in the long run.  In other words, G is not a ‘giant’ anymore in the Keynesian Y=G+C+I+NX.   [Although Keynes probably did not envision his legacy to last so long beyond depression, and he did say that we all would be dead in the long run ;-) ]

And, of course, the state should not forget to tax the rich!

As far as the “Russian Silicon Valley”, “Сколково”, that warrants a separate entry….


К портрету Путина…

…Виновны ль мы, коль хрустнет ваш скелет

В тяжелых, нежных наших лапах?

Скифы Блок

Великолепный портрет!  Taken from The Economist (December 2011).


Barents sea

Photograph taken by a member of expedition from Arctic-shelf lab, AARI, 2004-2009, Barents sea.

Barents sea

Photograph taken by a member of expedition from Arctic-shelf lab, AARI, 2004-2009, Barents sea.

Просьба к будущему президенту

У меня просьба к будущему президенту, перефразируя искандеровского кролика :-)
“Дяинька Путя, медвежатки хоцца…”

Russian elections

Неужели? Или как всегда…

This photo is from the Wall Street Journal (December 27, 2011).  It appears that thousands of people gathered in central Moscow on December 24, 2011.  There would be nothing unusual about a large crowd, if not for the fact that it was a demonstration against the rigged election, which by itself is not an unusual occurrence in Russia.  But Russian ‘usual’ and ‘unusual’ do not always obey the conventional Western definition.

However, it would not be unusual that Putin’s position strengthens if he is elected in March because the victory would mean that he managed to convince a sizeable and outspoken opposition.  Then he really must be the right guy for Russia! :-)  Putin’s victory after this exercise in democracy would also silence the West.  I am in no way denying that there exists a real opposition to Putin’s government in Russia and that many people joined protests by free will.  Prokhorov, of course, is a hoax, unless he is Medvedev II.  Just my two kopeks in…

I recommend reading David Satter’s opinion piece on these recent protests.  One of his other, very much worth reading, works on Russia is Darkness at Dawn.

The Russian elections in 2008 were commented by a LiveJournal blogger, Podmoskovnik.  I highly recommend reading Podmoskovnik’s blog.  There you can find stats and discussion of non-Gaussian distribution (distribution that is not bell-shaped, but is expected to be) of votes in past and recent elections.  Podmoskovnik cleverly called this ‘Churov distribution’ (дистрибуция Чурова) after the Chairman of the Election Committee.  Here is an example of a graph from this blog (December 2011).

If I remember right, one commentary in 2008 said:  “Подмосковник, пакуй чемоданы.”  Но Подмосковник пишет и ныне, хотя, впрочем, и выборы идут своим чередом.  Как всегда в России…

Novaya gazeta (in Russian) reported how local administrations were preparing for elections.  This article from November 9, 2011 provides a document titled “Instruction.”

The ‘instruction’ presented a schedule and rules of conduct for a group of citizens from a suburban town of Kirovsk.  These lucky citizens were supposed to be taken on a tour of St. Petersburg, coincidentally, on the day of elections.  They were to be fed breakfast after visiting 5 ‘sightseeing spots‘ and fed dinner after visiting another 8.  The instruction prohibited them from participating in any exit polls (!!!!).  Naturally, it is St. Petersburg museums and art galleries, not polling places that have exit polls ;-).  (Certain loopholes in the Russian law permit the same person to vote at multiple locations in the same election.)  The citizens were also promised some financial compensation at the end of their busy day.  What more to say?


DC and Northern VA photos

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