But, sadly, no interpretive dance.*
From Shakeddown, June 1, 2025:
Generalizing the concept of term limits
Once you come around on term limits, the concept is uncomfortably general.
Epistemic status: An uncomfortably political one again, though thankfully nonpartisan by nature. I don’t have any more Animorphs fanfic stacked up this time, so open to suggestions on how to atone for this one.
The Concept
Let’s start with a common story about finance.
Someone notices some underexplored idea - say, that you can repackage mortgage-backed securities into tranches, improving risk-adjusted profitability. The first few people who notice this make a lot of money, leading to more and more people piling in. Eventually, all the profit to be had out of the idea is mined out by all the people chasing it. But the downsides - the added risks or unwanted side effects of the idea - only scale up, because while each individual wants to avoid them no one can avoid them completely, and they stack up. So inevitably, the downsides come to dominate and the idea has to be abandoned, often with catastrophic results and, if we’re lucky, some very quotable movies made about the whole thing.
Note that this doesn’t always end up blowing up like this. Most of Warren Buffett’s profits were driven by the realization that low-beta, high quality stocks were undervalued and that he could get high profits by high-leverage investments in them rather than his (genuinely impressive) personal skill and insight, and eventually the market caught on. This didn’t lead to any dramatic blowups, it just means there’s there’s not going to be another Warren Buffet-style billionaire anytime soon. The core insight is still reasonable, but it’s no longer useful and the story has moved on1.
The concept (with fewer metaphors)
In 1796, Alexander Hamilton explained the concept of alpha decay to George Washington, who immediately realized the implications and resigned from office to establish the tradition of term limits....
....MUCH MORE
*With Half The Econ Commentariat Chattering About Recession, A Primer (last seen April 11, 2025)
Via MarketWatch, Oct. 21, 2014:
Explaining recessions via interpretive dance
This is informative, if unusual, viewing: the causes of recession as explained through interpretive dance.
Economic historian John Steele Gordon narrates the discussion. It’s a good explanation, albeit low on details of what caused the last recession, namely the spread of toxic mortgages and the ensuing crumpling of the financial system....
I was a bit disappointed when I realized we wouldn't be watching Krugman and Mankiw and Nordhaus and the rest of the troupe but it sort of grows on you.