Money money money

Money is a fascinating topic. What is it? Where does it come from? How does it work?

So for that reason, Philip Coggan’s Paper Promises is an exciting read. It’s pop-economics -easy, readable, and friendly, and at times I wished his exposition was a little more rigorous. But he does cover some interesting, and I think important, angles.

He covers the fundamental question – what is money?

something that people accept as payment for goods and services because they believe they can use the proceeds to buy goods and services from somebody else.

Of course, he then goes on to talk about the three traditional definitions of money – medium of exchange, store of value, and unit of account. Interestingly, he highlights the tensions between the different uses; as a medium of exchange, the more money, the better. As a store of value, the less, the better. And, of course, each of these uses depends on the others.

He also covers the fact that, once you go off the gold standard – to a purely fiat currency – then debt is money. The two are interchangeable.

But the key fact is that debt and money are two sides, not of the same coin, but of the same bank note.

Once you have a fiat currency, unbacked by an asset, there’s a bias towards the means of exchange – not the store of value use of money. Which matches up with the higher rates of inflation that have occurred since fiat currencies became common.

Another idea he discusses, which makes intuitive sense, was that debt shouldn’t, at some level, grow faster than the economy. Or, than expectations of future growth, is probably the more relevant variable. Either way, it’s an idea I’ve seen referenced in other situations, but hadn’t seen spelled out as clearly.

Overall, it was … an interesting read on the topic, and possibly not a bad place to start. But I kept finding myself thinking that it read a little like a hurried blog post, something that had been dashed off quickly without much editing (like this) – and wishing that it was a little more clearly structured.


Cancer and meaning

The Fault in Our Stars is amazing. Even as someone who’s never experienced cancer directly (although I have a friend who survived after a year of chem), I feel like there’s a lot of room to go wrong writing about cancer. And at times, it feels as though John Green is dipping into a set of easy outs, overly sugary images (the scenes in Amsterdam come the closest, for me). But it’s just such a good book. It talks about suffering, about bullshit, and about how we get on with it. 

Part of what’s so loveable about the book is the characters – they’re just fantastic. Funny, smart, mature, courageous but vulnerable – they’re the people you wish you were. So before the first chapter’s done you’re cheering for them.

Another part that I love is the thinking, the reflections of his protagonist on the deaths around her, and her own questions. She’s an unflinching materialist, so all the questions she has are ones that resonate with me, and she doesn’t dodge them, or hesitate to call bullshit when she sees it. Reading comments on the wall page of a recently deceased cancer victim:

You’ll live forever in our hearts, big man. (That particularly galled me, because it implied the immortality of those left behind: You will live forever in my memory, because I will live forever! I AM YOUR GOD NOW, DEAD BOY! I OWN YOU! …)

At the same time, she arrives at a sort of peace, an understanding, contained in the idea  that ‘some infinities are bigger than others’. I won’t go into it more, or risk ruining the plot, but … it feels intensely good to see someone grappling with that question about meaning as a materialist, and perhaps finding something close to an answer.

Throughout the novel, the voice Green uses is that of someone who’s seen cancer from the inside, and who isn’t afraid to call the bullshit – that people tell themselves, that people tell each other, and that people tell to other people with cancer. It’s great.

In fact, part of what I love about this novel is that it strikes a fine balance – in a way, actually, that reminds me of Vonnegut. It talks about the shittiness of human suffering and the human experience without any easy outs or cheap answers – it tells it like it is, without any tolerance for bullshit or false comforts.

But at the same time, it feels like a celebration of life. A saddened one, a melancholy one, because it recognises the grief – but a richer one because of it.

I could babble on for a while about this. For now I’ll just say – go, read it.

Manhood and vulnerability

If you like Mark Chabon (and let’s be honest, who doesn’t?) then you’ll probably like Manhood for amateursIt’s just great.

His collection isn’t bounded by much more than the theme implied in the title – what is manhood, and how do you get there?

The answer, if I can summarise anything from a set of excellent essays that sweep across more topics than you can shake a stick at, is by trying hard and being vulnerable. The first, perhaps, is one of those things that’s obvious but worth repeating.

Chabon is trying, trying so hard to be a good father, a good husband, a good brother and son (it’s an excellent reflection on the book, I think, that a lot of how he frames the questions is in relationships). He thinks about different relationships, he struggles to overcome his own weaknesses – it’s not the foremost element, but it’s there – this is hard work.

The other thing that I really like about Chabon’s accounts is the vulnerability that’s in them. This is a man who’s willing to acknowledge his own mistakes – more than that, sees it as crucial that he does so. But it isn’t a masochistic, self flagellating confessional – it’s an outgrowth of the value he places on honesty in relationships. 

When I became a father, I made a promise to myself not to pretend to knowledge I did not possess, not to claim authority I plainly lacked, not to hide my doubts and uncertainties, my setbacks and regrets, from my children. And so I have tried to share them over the years as I have been fired from screenwriting jobs or proved wrong or led to look a fool. I have made a point (until the recent advent of GPS) to stop and ask for directions.

The closest he comes to a code (thus far in my reading) is a simple statement when he’s discussing baseball players:

according to the conventions of my own garden-variety morality of consistent effort,altruism, and personal integrity defined as the keeping of one’s promises to other people.

And finally, there’s one other thing I really enjoyed – people laugh at me for this sometimes, but it just makes sense to me:

for true contentment, one must carry a book at all times

Living in Ulaanbaatar

It occurred to me recently that I haven’t done much to write about what it’s actually like, living in Ulaanbaatar. When I first got here there were plenty of other things in my mind – and since then, being here has become the new normal, so that I no longer find it strange to live in a house that’s permanently heated by a water system that permeates the city, or that I wear a mask virtually every time I step outside. So I thought I’d put down a few thoughts on what it’s like, living here.

I live in one of the old, Soviet style apartments (although quite nicely done up). The walls are thick – I’d say it’s a good forty-fifty centimeters of wall (I’m not sure if it’s concrete, brick, or something else) between the inside and outside. The windows, as far as I can tell, are not particularly thick – they tend to be the cold spots. There are heaters in most rooms – big, thick iron pieces that have hot water pouring through them. They’re hot to the touch, and you can’t sit on one for more than a few minutes. There are long conductor pipes that snake around the walls as well, and they’re equally warm. The hot water comes on when it comes on (my flatmate and I suspect that it was turned off for a few days, a sort of preliminary test run).

We have internet … somehow. When we first turned up there was a router sitting on a dusty sill – and when I went to a service provider and gave them my address (via the help of someone with better Mongolian than I have, translating over the phone) they smiled, nodded, and signed me up. And that was it. I have no idea how it’s regulated, or what the infrastructure underlying it is like – but our connection seems to work, if only intermittently.

Going outside is (at the moment) a process. It’s below negative thirty reasonably often (although today my taxi driver pointed at the gauge for outside temperatures: -18. “халуун байна” I said), and still cold even when it’s slightly warmer than that. So going outside means rugging up. Thermals under your trousers (I’m still just on one pair for now – we’ll see if that changes), and warm shoes (I was fortunate to get a pair of hand me down boots with lined insides), as well as a good jumper and a thick (and I mean warm) winter jacket. Since it’s gotten colder recently I’ve started wearing two scarves, a beanie, and ear warmers. If neccessary, you can always pull your hood up.

But once you’re outside, keeping warm isn’t the only challenge. Pollution is a biggie. If you picture standing down wind of a burning tire (not too close – maybe fifty metres?) you have a sense of what it smells like, just being outside. So I wear a face mask, either one of the disposable ones (which are easier to wear), or a full on Respro piece. The downside to this is that if you’re wearing a face mask, it’ll help, but odds are that the seal isn’t perfect. So warm air might be escaping upwards, where it might fog your glasses. Or, if it’s cold enough, condense in your eyebrows, which can snap freeze. Oh, and have I mentioned – your snot can freeze inside your nostrils, at the right temperatures? But probably the most serious side effect is fogged up glasses.

Which brings me to the other fun thing – walking and crossing roads. Ulaanbaatar hasn’t had snow that often, I’d say – perhaps a few times, a few centimetres at a time. Perhaps it’s more out in other spots. But because it’s so cold, the snow doesn’t disappear. In the city, it gets packed into a layer of dirty brown/grey ice, that’s rough and tumbly. Because there’s such a surplus of labour in UB, the city can afford to have people dealing with this by hand. So often, a day or two after snow does fall, you’ll see people in orange vests, chipping away at the ice that’s formed; long iron poles in hand, gradually shattering into hundreds of small shards, that are then piled up out of the way (and I assume, carted off somewhere?).

So most of the time, walking down the street is quite normal. The other (say, two percent of the time?) is that instant when your foot slips out from under you. There are patches of black ice where you’re almost guaranteed to fall, but even the normal dirty packed snow can be slippery, taken at the right angle. A few people I’ve seen seem to have mastered the art of skidding at will – somehow they’ll step forward and slide along, as though they were on roller blades, without seeming to overbalance. I can’t do that. I haven’t actually fallen, but I’ve spent some time teetering, tottering, and generally on that point just before you overbalance completely and land in a heap.

Street crossings are also fun. Ulaanbaatar traffic is actually quite pleasant to pedestrians, and people give way quite reasonably. What makes for the fun is that the roads are slippery – you have less traction, the drivers have less traction – it’s a careful balance between wanting to hurry out of the way of the oncoming traffic, and knowing that if you hurry too much you may go sprawling. Road crossings are probably the single thing I’ve found most frightening in Mongolia, and that puts them ahead of galloping without knowing how to ride, and sledding across ice that was cracking beneath me.

Another thing that’s different-new-normal is that while UB has official taxis (some of whom I’ve even managed to order by phone!), it also has unofficial ones. The closest parallel I know of (although I’m sure there are others) is post war Germany (embarrassingly I’ve forgotten which war, although I think it was post World War II) where apparently money was scarce enough that a person waving currency by the side of the road could persuade the average driver to stop, and take them where they needed to go. I’m not sure if it’s the same monetary pressure in Mongolia, although I suspect is probably is (and, perhaps, the lack of regulation helps) – but here, you can essentially stand and hail, and cars will just stop. Of course, if they’re not heading in your general direction, they’re less interested in taking you.

I haven’t completely figured out whether the reasons taxis take people is a money thing, or a social thing, or some combination of the two. But I’d be intrigued to know.

And as for UB itself? I’m still reminded of an email that someone sent me before I arrived here, where they described UB as booming mining town on top of crumbling Soviet infrastructure. There is a lot of money around – there are nice restaurants, expensive clothes, and, that Louis Vuitton store that gets mentioned in every article about UB written since 2010. So if you have the cash, you can live quite comfortably – it’s not New York, but there’s good food, nice places to go out, expensive swimming pools and gyms – it’s all here. But at the same time, there just doesn’t seem to be much of a middle class that I can see. None of the middle class brands that I think of as the obvious symbols of globalisation have made inroads here (granted, for McDonalds apparently they couldn’t source consistent lettuce) – but where’s the Starbucks, the mid range brand name supermarkets, where are the other places selling aspirational middle-class Westernism?

So instead you have this dichotomy, between the rich and poor (I don’t have a strong sense of this, either anecdotally, or in figures – but I suspect it’s quite the gap, on average). And then there’s the crumbling Soviet infrastructure. The current government is doing some things, as far as I can tell – major roadworks at some point, restrictions on cars on particular days to reduce congestion (that’s a whole other set of things) … but I think there’s a real restriction on their capacity. Partially it’s probably funding, there’s probably some corruption in the mix as well (I have no idea of any specific examples, or how much), and partially there’s the ever present challenge of bringing significant change to a large system or bureaucracy. But regardless, things are a little bit frayed around the seams. Brownouts are a semi-regular thing, the roads don’t feel as though they’ve been thought through, and … there’s something in the air of the city, of a place that’s old and getting older quickly. There are shiny, tidy things, but they’re the new ones – Central Tower, the other major buildings going up (and even Blue Sky is starting to look a little dusty on top). There’s very little that’s old, that looks well maintained. The state opera and theatre house has graffiti on it, the apartment blocks (even close to the centre of the city, where I live) have a slightly tired air to them, and some of the older shops near me are covered in grime. I suppose my sense is that UB feels like a city that’s straining, but I have no idea when the breaking point arrives, or what it looks like.

That’s a pessimistic note to end on. There are some definite bright lights in Ulaanbaatar’s and Mongolia’s future, and some other things that have struck me, but they can wait for another post.

There’s a lot more that’s different and interesting over here – but that can also wait for another blog post.

Love and happiness

Gone Girl, by Gillian Flynn, is a great novel. I tore through it in a few days (being home sick from work for one of those days didn’t hurt), because it is very much a page turner. 

The suspense of the murder mystery that Flynn creates is a key part of what keeps you reading – there’s a very delicately woven narrative (that she creates from at least two, if not three angles), and an ingenious series of clues with multiple interpretations. I haven’t read a lot of crime/mystery writing, but I think Flynn’s done a great job with providing some, enough information without beating you over the head with facts and/or red herrings. 

But I think part of what makes this story great – what lifts it above the normal detective piece with clues and theories and suspects – is that it’s simultaneously a love story. And while I think it’d be a very different novel without the suspense – would have much less drive, would probably not be nearly as popular – I think a key part of the story is the love between the two main characters. 

She writes it beautifully – she tells it from different perspectives, so that you have a multi-faceted, and slow (some of the diary entries span years) perspective on the gradual breakdown of a relationship. Now, whether that’s the whole story, or an accurate set of angles … I don’t think matters too much. Because what’s amazing is how she gets into the details – the way people interpret small things, the way they build stories inside their heads, the way two people can become strangers to one another. You feel as though you’re seeing a train wreck in slow motion, watching these two people collide tragically with one another. 

So I think the strength of the novel comes not just because Flynn’s told a great love story, and a great detective story. It’s because she’s woven the two together so well that the two strengthen each other, leaving you with something that’s both gripping but with a bit of depth, that it’s such a great read.

The yield curve(s) in Mongolia

At the bank the other day I saw a flyer for their deposit rates. Interestingly, Mongolia has a situation where a large portion of their banking system accepts deposits in USD; a sort of parrallel, less prone-to-inflation currency. So having those two yield curves allows for two interesting comparisons, as per the chart below. 


One is the between the two yields offered by the same bank, in different currencies. The yield in Tugriks is higher, and the margin increases a little over time. Some IMF economists did a working paper on Mongolia’s inflation; it’s been a while since I read it, but one thing I do remember is that there’s a regular shock (winter) to food prices, which is unsurprising given how difficult transport must get. 

The other comparison is with the US yield curve, taken off the Bank of America CD rates. The fact that the curve is so much higher here suggests that there’s a substantial risk of default in the banking system (or perhaps less trust in the authority’s ability to bail them out).