## More election musings

A little closer to the bottom of the barrel…

• Trump has shattered not one but both major parties. Looking forward to the internecine fighting.
• Mike Pence is going to be the most powerful VP since… Dick Cheney, I guess. Trump has essentially zero knowledge about the mechanics of government and legislation. Pence has been both a Congressman and a governor. Trump will set the direction (CEO), but the operations of the Trump Administration will fall to Pence (COO). I hope you like him.
• Trump should use reality TV contests to select his cabinet.

You know, I would actually watch that for Defense, State, and maybe AG.
• I am not sure whether Bernie could have defeated Trump. But I think Biden would have. (Hillary had the union bosses but lost the men on the factory floor. Biden would have had both, and when combined with the Dem machine, that would have been enough.)
• More people are protesting Trump’s victory than attended Hillary’s rallies.
• There is going to be a Donald Trump Presidential Library.
• “Great Again Dot Gov” LOL
• So when does Trump TV launch?

## Election musings…

…in no particular order.

• I wonder how much Hillary will be paid for her next speech.
• Can we please stop with the SHE WON THE POPULAR VOTE thing? If we had a popular vote system, (a) the candidates would campaign differently and (b) Republicans in states like CA and NY would actually have a reason to vote. This is like losing a football game and then shrieking BUT WE GOT MORE RUSHING YARDS. It is just embarrassing; or, in the modern vernacular, sad!
• Speaking of the Electoral College, our system does not allow you to become President by appealing only to the population centers. This is by design, it has always been true, and (let us hope) it always will be.
• Huma Abedin is having a pretty bad year.
• I have been anticipating a Hillary Presidency since the first time I saw her on the national stage in 1993. I thought it was inevitable. I knew — knew! — that somewhere in my future lay eight years of that person holding the reigns of power. I even donated to Lazio’s 2000 Senate campaign in a futile effort to slow her down.
Having a confidently-held 23-year-old belief ripped from you is an interesting (and yuge!) experience. Hillary Rodham Clinton… will never be President. I am still trying to wrap my head around it.
• Live by Executive Order; die by Executive Order. Perhaps you should have used the Legislature to legislate?
• When I first heard about Trump’s campaign, I thought he was an idiot and his candidacy a stunt. Over the course of the primaries, I was forced to update my priors. I figured out sooner than most — though later than some — just how (bigly!) wrong I was.
I now realize I am not smart enough to understand Donald Trump. If you believe a buffoon has somehow managed to stumble into the Presidency Chauncey Gardner style, you are letting the wrong people give you your opinions.
• Live by the Supreme Court; die by the Supreme Court. Perhaps you should have used the Legislature to legislate?
• In her concession speech, Hillary mentioned people who had donated money to her campaign, “as little as $5″. She forgot to mention the people who donated as much as$20 million. They spent a billion dollars trying to drag her across the finish line.
All of those donors, all of the global banks and foreign governments… The return on their investment is going to be zero. This is probably my single favorite thing about this election.
• Trump is more likely to pardon Hillary than to prosecute her.

## Betting site links: Election 2016

The betting sites react very quickly to new information, so they provide an excellent way to monitor events in real time.

Granted, in 2012 my favorite market (InTrade – RIP) was clearly manipulated. Had anyone been set up to perform the arbitrage, they could have pocketed a few million risk-free dollars on election day. My guess is that the arbitrageurs are ready this time around, which means it does not matter which betting site you watch; any attempt to push on one requires pushing on them all.

That said, my favorite these days is Betfair, and all of these links go there. It is a fairly liquid market. As I write (Nov 7 12:30 EST), they have $137 million in matched bets on the overall election outcome. Click the “Back & Lay” check box to see the ask/bid spread. You can think of the number as a reciprocal probability (e.g. back/lay of 2 means probability of 1/2 = 50%). Or you can think of it as the number of sides in a die roll (e.g. 6 = 1d6, 2 = coin toss, etc.) Overall outcome Pennsylvania North Carolina Florida Virginia Michigan Nevada Colorado ## Trump, of course Frankly, I do not understand why anyone other than cat ladies and doughy beta males would vote for anyone else. OK OK I exaggerate. And anyway I would likely support anyone running against Hillary. But I really am voting for The Donald with enthusiasm, and I want to take a moment to explain why. Back in college, I had a buddy who annoyed literally everyone. And I do not mean that in some boring, passive way; this guy was smart, and he carefully honed his skill. He had a preternatural ability to determine how best to irritate you at any moment, and he would deliberately do precisely that, repeatedly. At first I found him… well, annoying. But over time, I recognized that there are a lot more other people in the world than there are of me. Being the occasional target of his talent was more than repaid by watching his effect on friends (funny) and adversaries (hilarious). Granted, the current topic is Donald Trump and the Presidency of the United States. But if the last 16 years have demonstrated anything, it is that there is no such thing as “qualifications for the office of President”. Actually, Trump is more qualified than most, at least in the ways that matter. For example, imagine making a list of great Presidents and another list of Presidents who were policy wonks. How much overlap would you find? Not that I mind (most of) Trump’s policies. To take one example: I vastly prefer the general notion of “kill people who are trying to kill you; otherwise, mind your own business” versus the Bush/Obama/Hillary/etc. modality of nation building / regime change / coup instigation. I am the first to admit that I am no expert on foreign policy. But that is kind of the point; such experts do not have a particularly stellar track record. Competence leading to overconfidence is perhaps the most human of all failings. Unlike most endeavors, however, foreign policy is one where overeducated a**holes playing God have a tendency to leave piles of bodies in their wake. Simply put, Hillary is obviously more likely to get us into a war. Back to that college buddy. Of course I do not like everything about Donald Trump. (I mean, come on…) But the damage he would or could do to things that I like is vastly outweighed by the damage he would do to things that I hate, e.g. this. The Democratic establishment hates him, the Republican establishment hates him, Wall Street hates him, Hollywood hates him… This election season has exposed the deep irony of our ruling political party, donor class, and press acting as a single entity while labeling the opposition “fascist”. Seeing all of them react to a President Trump would be… hilarious. So, yes, the enemy of my enemy is not my friend. But he will do. ## A little FBI narrative Quick little speculation before it all becomes history… Comey’s letter was an extraordinary event. He is a smart guy, so he must have had an extraordinary reason. Sure, maybe he is just trying to sway the election. But (a) that would be counter to every aspect of his reputation and track record; and (b) he could have done it more effectively (and less suspiciously) simply by referring the case for prosecution back in July. This is an interesting observation: He is right. The Weiner investigation is being conducted by the local DoJ (including FBI) in New York, not by the home office in Washington. So how about this for a narrative. In the process of investigating Carlos Danger’s perversions, they combed through a computer he shared with Huma and found… something. At least a few of these local agents and attorneys are career law enforcement types, not politicized strivers, and they are outside the… um… let’s say “environment” of D.C. They have seen whatever the “something” is, and had Comey not made some public statement, they would have. I do not know whether this narrative is true. But it seems to fit all the available facts. Is the “something” actually nothing? Hillary, Obama, and Biden have canceled all campaign appearances until election day. Huma is in tears. Sure, probably nothing. ## Farewell to The Economist An Email I sent this weekend: To: customerhelp@economist.com Subject: Please cancel my subscription My Customer Reference Number is … My address is: … I have been a subscriber for more than two decades, but your latest cover story (“Globalisation and Politics: The new political divide”) is pure propaganda that I have no interest in financing. I am saddened to see the decline of a once great publication. I will be donating my refund to the Trump campaign. Aside from Technology Review (which is free), The Economist is the only magazine to which I still subscribe after all these years. Or rather, it was. I am not naïve. As a long-term subscriber, I am well aware of The Economist’s leanings and how they differ from my own. But I expect them to display some vague understanding of both sides of contentious issues, and then to argue their case with facts and intelligent reasoning. Smart people disagreeing with me are among my favorite things to read. But this… is such blatant and ridiculous propaganda that I am not even sure where to begin a critique. It simply mocks itself from beginning to end. Oh what the heck; since it is likely the last Economist article I will ever read… Farewell, left versus right. The contest that matters now is open against closed There it is, right from the get-go. The proper and well-known terms in this context are “nationalism” and “globalism”. And it is not as though “nationalism” has universally positive connotations; at least, not yet. But just to make sure, they chose value-laden terms tangential to the debate. I mean, really, how could any reasoning person prefer “closed” to “open”? Checkmate! So far, Britain’s decision to leave the European Union has been the anti-globalists’ biggest prize: the vote in June to abandon the world’s most successful free-trade club Wait, do you mean the super-state with its own flag, anthem, and barely-elected rat-faced bureaucrats hostile to the very concept of nation states whose edicts on every topic (including immigration) override national parliaments? That “free-trade club”? was won by cynically pandering to voters’ insular instincts I see. So apparently Brexit won because UK voters were tricked into thinking trade is bad. Listen, you disingenuous mouthpieces, the UK voted out precisely because the EU is not remotely a “free-trade club” and the electorate knows it. Does that scare you? I think it scares you. On July 26th two men claiming allegiance to Islamic State slit the throat of an 85-year-old Catholic priest in a church near Rouen. It was the latest in a string of terrorist atrocities in France and Germany. The danger is that a rising sense of insecurity will lead to more electoral victories for closed-world types. This is the gravest risk to the free world since communism. Nothing matters more than countering it. In other words, the biggest threat posed by Islamic fundamentalists hell-bent on annihilating the people and culture of the West, and who have shown the willingness and ability to infiltrate our societies, is that the wrong kind of politician might get elected. I have honest-to-god seen parody accounts make this argument more convincingly. Even so, for Mr Trump to urge Russia to keep hacking Democrats’ e-mails is outrageous. This is the point where I decided to cancel my subscription. What Trump has done throughout his campaign — and I mean throughout — is called “trolling the media”. Here is how it works. Trump makes a statement, no matter how ridiculous, and the media reaction is invariably even more ridiculous. (Note: Image is exaggerated but not by much.) The result is free publicity and usually a bump in the polls. It has been fascinating to watch. This instance was not even very subtle. “Hey I hear Russia has Hillary’s deleted Emails. Maybe they should give them to the FBI!” That’s all? Seriously? My personal theory for why it works (and keeps working) is that journalists are morons. But I expected better from The Economist. Sigh. I am bored now, so go read the rest yourself. See if you smile like I did at the word “worryingly”. Oh, and do not miss the comments sorted by recommendations. I like the one saying that the wall in the cartoon should have a sign reading “Please Use The Door”. ## Hillary (4) – Totally Exonerated I decided it would be fun to go through portions of FBI Director Comey’s statement and paraphrase. Note that he did not have to provide so much… detail. In fact, he did not have to say anything at all. During his delivery, he seemed to add special emphasis each of the numerous times he directly contradicted some public statement of hers. But perhaps that is my imagination. Our investigation looked at whether there is evidence classified information was improperly stored or transmitted on that personal system, in violation of a federal statute making it a felony to mishandle classified information either intentionally or in a grossly negligent way, or a second statute making it a misdemeanor to knowingly remove classified information from appropriate systems or storage facilities. “Bear in mind the phrase ‘grossly negligent’.” Secretary Clinton used several different servers and administrators of those servers during her four years at the State Department, and used numerous mobile devices to view and send e-mail on that personal domain. “Remember when she said she used a personal server to avoid having multiple devices? She lied.” From the group of 30,000 e-mails returned to the State Department, 110 e-mails in 52 e-mail chains have been determined by the owning agency to contain classified information at the time they were sent or received. “Remember when she said she never sent nor received classified information? She lied.” “Remember when she changed her story to never having sent nor received information that was classified at the time? She lied.” The FBI also discovered several thousand work-related e-mails that were not in the group of 30,000 that were returned by Secretary Clinton to State in 2014. “Remember when she said she had returned every Email ‘remotely related to work’? She lied.” Although we did not find clear evidence that Secretary Clinton or her colleagues intended to violate laws governing the handling of classified information, there is evidence that they were extremely careless in their handling of very sensitive, highly classified information. “Can you distinguish ‘grossly negligent’ from ‘extremely careless’? Me neither. Thanks for paying attention.” None of these e-mails should have been on any kind of unclassified system, but their presence is especially concerning because all of these e-mails were housed on unclassified personal servers not even supported by full-time security staff, like those found at Departments and Agencies of the U.S. Government—or even with a commercial service like Gmail. “Commercial services like Gmail, with full-time security personnel, are completely pwned by all competent intelligence agencies. So seriously, what chance do you think a piece of shit Exchange server set up by some loser I.T. monkey has?” But even if information is not marked “classified” in an e-mail, participants who know or should know that the subject matter is classified are still obligated to protect it. “Remember when she changed her story to having never sent nor received anything ‘marked’ classified? Such markings are not required, so she misled.” Only a very small number of the e-mails containing classified information bore markings indicating the presence of classified information. “Also she lied.” With respect to potential computer intrusion by hostile actors, we did not find direct evidence that Secretary Clinton’s personal e-mail domain, in its various configurations since 2009, was successfully hacked. (He could have stopped right there, but…) But, given the nature of the system and of the actors potentially involved, we assess that we would be unlikely to see such direct evidence. “We do not know how many foreign adversaries hacked her system, because a piece of shit Exchange server set up by some loser I.T. monkey does not even keep adequate logs for that determination. As a result, we will never know the full extent of the damage.” We do assess that hostile actors gained access to the private commercial e-mail accounts of people with whom Secretary Clinton was in regular contact from her personal account. We also assess that Secretary Clinton’s use of a personal e-mail domain was both known by a large number of people and readily apparent. She also used her personal e-mail extensively while outside the United States, including sending and receiving work-related e-mails in the territory of sophisticated adversaries. Given that combination of factors, we assess it is possible that hostile actors gained access to Secretary Clinton’s personal e-mail account. “If you think there is any chance Russia and China do not have every bit of data from every one of her servers, you are an idiot.” In looking back at our investigations into mishandling or removal of classified information, we cannot find a case that would support bringing criminal charges on these facts. “Despite being a clear violation of statute, this sort of reckless incompetence is not usually punished by jail time.” (Again, he could have stopped there, but…) To be clear, this is not to suggest that in similar circumstances, a person who engaged in this activity would face no consequences. To the contrary, those individuals are often subject to security or administrative sanctions. “However, anyone else who did a fraction of this would never again be allowed to so much as sweep the floor in a secure facility.” So, what is the take-away headline? HILLARY CLEARED OF ALL CHARGES! I am sure that is what he was aiming for. ## Hillary (3) – Child rape cases are a hoot You might want to start with the background article. Summary: Hillary successfully defended a child rapist — oops, I mean “accused” child rapist — back in 1975. But that is not the interesting part. The interesting part is this interview: Note that this is raw source material. No pundits; no shills; no conspiracies… Just Hillary Rodham, in her own words. Now, I can already hear you blathering something about adversarial justice systems, so I will pause to let you finish. There, are you done? Good. Yes, yes, I understand the right to counsel. I understand that it is better to let ten guilty men go free (or was it 100?) than to punish one innocent. I understand the argument that, if you rape a 12-year-old girl but the prosecution mishandles your underwear with her blood on it, that you “should” walk. I do not necessarily agree, but I certainly understand the argument. So let’s say we stipulate all of this. This interview is still incredibly damning, not for what it says about the case, but for what it says about the state of mind afterward. Some of us would have trouble defending an accused child rapist. If we accepted the case and came to believe our client was guilty, many of us would have trouble proceeding. If we proceeded anyway and won, almost all of us would have mixed emotions at best. We would not later reminisce about it, and boast about it, and laugh about it. We would not say in an interview, “Lawdy, I had some tough cases in those days! I remember this one child rapist yuk yuk yuk … and I got him off with time served! Ah, memories.” We would be incapable of this because of that little voice in our head; you know, the one that distinguishes right from wrong? That little voice would constantly be whispering, “Dear God, he RAPED that little girl and I helped him go free.” A few people are born without that little voice. We call them “sociopaths”. This recording demonstrates that Hillary lacks that little voice. But please, do not take my word for it. Do not let me, or anyone else, tell you what to think. Listen for yourself, and draw your own conclusions. ## Prediction markets and Brexit My day job leaves little time for blogging, but I want to get this down before the whole topic is history. The Brexit referendum begins in just a few hours. The Leave side was showing momentum prior to the murder of Jo Cox, but since then, pretty much all polls have been stuck at “too close to call”. Prediction markets, on the other hand, have indicated a bias against Leave regardless of the polls. As I write, they give Leave just north of a 25% chance. The question is, why are the polls and the prediction markets so different? This morning, Zero Hedge (I know, I know, bear with me) published a very interesting article pointing out that the Remain bets are fewer in number but larger in dollar amount. In a brief Twitter exchange, JC Kommer reminded me that it is normal for the bet sizes to skew as the odds shift. (This is simple math; for a$1 payout at a 25% probability, one side has to put up $0.25 and the other$0.75.) But the skew here is significantly larger than 3:1… So it is demonstrably true that the Leave odds are being pushed down by a comparatively small number of large bets.

When I mention this to family and friends, some say that it is not surprising, since relatively small amounts of money can move these markets around. Remember 2012?. But I am not so sure in this case. Betfair alone has over $70M in matched bets on the referendum, and thanks to arbitrage, manipulating any prediction market requires pushing on all of them combined. I can think of a few reasons the Big Money might be betting against Leave. Maybe they are the same as the Smart Money, and the prediction markets are just doing the efficient thing. Or maybe they prefer Remain and think that manipulating these markets can tilt the balance in the real world; cf. reflexivity. (People do prefer to vote with the winning side.) Or maybe they are trying to manipulate other assets indirectly, several of which are heavily correlated with these markets. Of course, these explanations are not mutually exclusive, and I do not ever expect to know for sure. But the bias of the Big Money is surprisingly visible. In the future, I expect they will use a large number of small bets to hide this sort of tell. [Update 2016-06-23 16:30 EDT] Betfair now shows$97M in matching bets with Leave at 14%.

[22:12 EDT]

$137M in matched bets, odds essentially 50/50. Holy crap. Tonight is basically God’s stop hunt ## Hillary (2) OK, full disclosure: I do not like Hillary Clinton. Actually, I think the Clintons are sociopaths. Literally. Both of them. Of course, I could be wrong. I am fully aware that most of what I believe is the result of deliberate propaganda. Just like most of what you believe. That is why I look for stories that I can evaluate based on my own direct, personal knowledge. In that spirit, from all the wonderful Clinton stories over the years, I want to discuss just two. The first is the cattle futures incident. I am sufficiently familiar with markets to know that there is only one way to turn$1,000 into $100,000 over ten months of trading cattle futures, which is illegally. I do not know why someone wanted to transfer$100,000 under the table to the wife of the governor of Arkansas; I just know that is what happened. This is not propaganda. This is not partisanship. This is mathematics.

You can argue the late 70s was a long time ago. Certainly, the relevant statutes of limitations have long since expired. But she never admitted any wrongdoing. That makes this an ongoing lie, which makes it current and therefore relevant.

The second story, naturally, is the Email server. I know quite a lot about Email servers. For example, I could code one. And the operating system on which it runs. And design the hardware. Anyway, I know there is only one reason a sitting cabinet official routes all of her electronic communications through a server in her basement, which is to keep them away from people with legal authority to view them (e.g. law enforcement or the Judicial branch). And I know that any claim to the contrary — such as “it was a matter of convenience” — is a lie.

I really do love this story because my personal knowledge in this area is orders of magnitude greater than any journalist’s. So whenever I read an article about Hillary’s email server, I do not learn anything about Hillary’s email server; I learn something about the author of the article. For example, when I read someone calling it a “personal Email account” rather than a “personal Email server”, or comparing it to Colin Powell’s AOL account or whatever, I know I am reading a partisan hack making a lame attempt to deceive stupid people. (Or just a really stupid journalist. It can be hard to tell the difference.)

The Hillary campaign says her arrangement was allowed by the rules at the time. That might or might not be true; with the Clintons, you never know. But assuming it is true, that is only because the rules at the time did not contemplate something so ridiculous as a sitting cabinet official routing all of her electronic communications through a server in her basement.

Which brings us to the felonies. Classified data is another area where I actually know something. Dating myself a bit, once upon a time I internalized the Orange Book and several of its interpretations. I know all about mandatory access controls and covert channel analysis and formal verification methods… In short, I am very familiar with the difference between the kind of system that processes classified information and the kind of system you get when you ask some pathetic I.T. monkey to set up an Exchange server in your basement.

I am not a lawyer. But I do know that there is only one way for top secret codeword information to migrate from an authorized to an unauthorized system, which is illegally. Based on facts already published, I know that someone, somewhere committed a felony. I do not know exactly who, or exactly which felony, because there is more than one possibility. (My own suspicions would start with Huma Danger, née Abedin.) But I am 100% certain that someone committed a crime.

I do not expect anyone to be held accountable, of course, since in our system we are all very much unequal under the law. These crimes will never approach indictment. The generous explanation is that there is a difference between proving some felony occurred and convincing a jury that a specific person committed a specific felony. The realistic explanation is that the Obama administration does not prosecute its friends.

She will be the nominee and most likely President. Tens of millions in financial sector donations buys a lot of hack journalism, and the fix is in. More on that in another installment, perhaps. Although I might need to get drunk first.