WMD press from Germany, Israel, and the Netherlands

November 15, 2016 1 comment

The Netherlands’ Vrij Nederland, written by Gerard Janssen:




Germany’s Die Tageszeitung, written by Ingo Arzt:

German WMD article INGO ARZT.png

Israel’s Calcalist, written by Uri Pasovsky:







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Guest post: the foreclosure vote

This is a guest post by Tom Adams, who spent over 20 years in the securitization business and now works as an attorney and consultant and expert witness on MBS, CDO and securitization related issues.

I don’t expect anyone to really come up with the perfect explanation for why Clinton lost and Trump won the presidential election.  But I do spend some time looking at these maps:



The first map is from RealtyTrac, and indicates the states with the largest foreclosure inventory in 2012. The second is a map of the key battleground states. In 2008 and 2012, Obama won these states. In 2016 Clinton lost them. There’s a lot of similarities between those two maps.

Even in the best economic environment, residential mortgage foreclosure is a long, messy process. The massive wave of foreclosures that hit these regions after the financial crisis had enormous consequences economically. They also had a tremendous, painful impact on the families and neighborhoods of the people affected, directly and indirectly by the foreclosures.

A rise in the number of suicides have been tide to the wave of foreclosures. Large swaths of neighborhoods were plagued by falling property values, blighted abandoned homes and a sense of uncertainty and, perhaps, doom. I often think about the effect the foreclosure crisis had on the children of affected families and the impact of children watching families, neighbors and classmates going through the painful process.

I was involved, to a small degree, with homeowners, activists and lawmakers that tried to deal with the issues and problems in the foreclosure crisis, some of which is documented in David Dayen’s excellent new book, “Chain of Title“. As Dayen documents, the government response to the issues was ultimately terribly unsatisfying and at best, had the effect of sweeping the issue under the carpet.

The consequences of the government’s response played out in this presidential election.

Clinton was aware of the problems caused by the wave of foreclosures: last fall the NY Times reported that the campaign was frustrated that the crisis had displaced so many homeowners that their database of voters was disrupted. Perhaps this is why the campaign’s get out the vote efforts in Michigan, Wisconsin, Minnesota and other states were much less effective than the campaign had hoped for. Some reports were that up to [25%] of the voters the campaign contacted were actually Republicans or potential Trump voters. In fairness, Clinton was probably concerned about the economic plight of affected homeowners and communities than she was about the technological issues it caused, but that was hardly the dominant campaign message.

How much of an impact would a compassionate outreach have had on these neighborhoods? It’s also worth remembering that the people hit by the foreclosure crisis were generally middle class – prior to the crisis they owned homes, held jobs, were members of the community. Where were they by the time the 2016 election came around?

Certainly, it’s a complicated issue and made more complicated by the fact that the Obama Administration didn’t cover themselves in accolades during the mess. But what if she had said something like this while campaigning in the battleground states:

“While I appreciate the efforts of the Obama administration to address the foreclosure crisis, the Home Affordable Modification Program simply has not provided the relief needed by many families. That is why I strongly support the creation of an Office of the Homeowner Advocate to help struggling families who have been wrongly denied assistance, or who have had difficulties navigating the extremely stressful system of avoiding foreclosure. The Office of the Homeowner Advocate will not only give Vermonters a strong voice in the process, but it will identify ways to make the HAMP program work better,”

That, unfortunately is a statement from Bernie Sanders, in 2010, rather from Clinton (Sanders continued to make it a focus of his primary efforts in 2016 as well).

Or perhaps Clinton could have spoken out in support of the frustrated community groups that sought to participate in the HUD auctions of distressed loans, only to lose out time and again to hedge funds, many of which were run by bankers who were directly involved in the financial crisis.

Maybe she was reluctant to get too involved in the issue because she tried to talk about it back in the 2008 primary and ended up being tagged as a too close to Wall Street. On several occasions in foreclosure states like Nevada, she seemed to cede the issue of the financial crisis  to Sanders and focused her efforts on minority outreach instead. But in states like Florida, where many homeowners remained underwater on the value of the homes and mortgages still in 2016, the issue appeared to still be on the minds of voters on the eve of the election.

Of course, it’s easy to second guess the campaign now. I, and many others, spend hours over several years trying to get the Obama Administration or state governments to improve their response to the foreclosure crisis. By 2016, many of the people I worked with back in 2011 to 2013 on housing issues were exhausted and frustrated. I can only imagine how the people living with the foreclosure crisis must have felt.

Still, a few thousand votes in three key states would have been enough to change the outcome of the election. And when you compare these maps, it’s hard not to see the lost opportunities.

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The Models Were Telling Us Trump Could Win

This is a post by Eugene Stern, originally posted on his blog sensemadehere.wordpress.com.

Nate Silver got the election right.

Modeling this election was never about win probabilities (i.e., saying that Clinton is 98% likely to win, or 71% likely to win, or whatever). It was about finding a way to convey meaningful information about uncertainty and about what could happen. And, despite the not-so-great headline, this article by Nate Silver does a pretty impressive job.

First, let’s have a look at what not to do. This article by Sam Wang (Princeton Election Consortium) explains how you end up with a win probability of 98-99% for Clinton. First, he aggregates the state polls, and figures that if they’re right on average, then Clinton wins easily (with over 300 electoral votes I believe). Then he looks for a way to model the uncertainty. He asks, reasonably: what happens if the polls are all off by a given amount? And he answers the question, again reasonably: if Trump overperforms his polls by 2.6%, the election becomes a toss-up. If he overperforms by more, he’s likely to win.

But then you have to ask: how much could the polls be off by? And this is where Wang goes horribly wrong.

The uncertainty here is virtually impossible to model statistically. US presidential elections don’t happen that often, so there’s not much direct history, plus the challenges of polling are changing dramatically as fewer and fewer people are reachable via listed phone numbers. Wang does say that in the last three elections, the polls have been off by 1.3% (Bush 2004), 1.2% (Obama 2008), and 2.3% (Obama 2012). So polls being off by 2.6% doesn’t seem crazy at all.

For some inexplicable reason, however, Wang ignores what is right in front of his nose, picks a tiny standard error parameter out of the air, plugs it into his model, and basically says: well, the polls are very unlikely to be off by very much, so Clinton is 98-99% likely to win.

Always be wary of models, especially models of human behavior, that give probabilities of 98-99%. Always ask yourself: am I anywhere near 98-99% sure that my model is complete and accurate? If not, STOP, cross out your probabilities because they are meaningless, and start again.

How do you come up with a meaningful forecast, though? Once you accept that there’s genuine uncertainty in the most important parameter in your model, and that trying to assign a probability is likely to range from meaningless to flat-out wrong, how do you proceed?

Well, let’s look at what Silver does in this article. Instead of trying to estimate the volatility as Wang does (and as Silver also does on the front page of his web site, people just can’t help themselves), he gives a careful analysis of some possible specific scenarios. What are some good scenarios to pick? Well, maybe we should look at recent cases of when nationwide polls have been off. OK, can you think of any good examples? Hmm, I don’t know, maybe…



Look at the numbers in that Sun cover. Brexit (Leave) won by 4%, while the polls before the election were essentially tied, with Remain perhaps enjoying a slight lead. That’s a polling error of at least 4%. And the US poll numbers are very clear: if Trump overperforms his polls by 4%, he wins easily.

In financial modeling, where you often don’t have enough relevant history to build a good probabilistic model, this technique — pick some scenarios that seem important, play them through your model, and look at the outcomes — is called stress testing. Silver’s article does a really, really good job of it. He doesn’t pretend to know what’s going to happen (we can’t all be Michael Moore, you know), but he plays out the possibilities, makes the risks transparent, and puts you in a position to evaluate them. That is how you’re supposed to analyze situations with inherent uncertainty. And with the inherent uncertainty in our world increasing, to say the least, it’s a way of thinking that we all better start becoming really familiar with.

The models were plain as day. What the numbers were telling us was that if the polls were right, Clinton would win easily, but if they were underestimating Trump’s support by anywhere near a Brexit-like margin, Trump would win easily. Shouldn’t that have been the headline? Wouldn’t you have liked to have known that? Isn’t it way more informative than saying that Clinton is 98% or 71% likely to win based on some parameter someone plucked out of thin air?

We should have been going into this election terrified.

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It’s Time to Smell the Shit

People voted for Trump because he was speaking to them about their pain, and making unreasonable promises about how great the future would be for them.

At the same time he was unforgivably awful to all sorts of subpopulations of Americans. The people who voted for him either embraced that hate or ignored it.

This means two things for the rest of us.

First, it means we need to help Trump voters smell their particular shit, which is going to be hard for them, because many of them actually trusted Trump’s promises. That means we document all the ways their expectations have been unmet in the next four years. We have to keep track of the inevitable blame game that Trump is so good at, where he will vilify random people when he fails to deliver his promises.

Second, it means we need to carefully watch all those people who were willing to embrace the hate; they have been empowered and could be truly dangerous, especially when the shit first gets smelled. Nor can we rely on those people who don’t think of themselves as racist but who ignored the hate. They are willing to remain passive in the face of hatred, exactly what we cannot do. People, we need to protect one another, and in particular we need to protect the most vulnerable among us.

How do we document and protect? It starts with citizen journalism. As individuals, we need to use our phones, our blogs, and our conversations as opportunities to speak clearly about what we witness.

We need to train ourselves to intervene when we see someone get singled out for their religion or the color of their skin. We all need to get off of the toxic echo chamber that is Facebook and engage with people in a coffee shop that we happen to meet. Who knows, we might disagree with them, but that shouldn’t stop us from communicating civilly. We need to travel away from our cities and interact with people outside our normal lives.

We need to support independent journalism (choose your two favorite) and civil rights groups (ACLU, Legal Defense Fund) so they can do their jobs, which are crucially important.

We also need to organize locally to do more. This means more than a protest march. It’s a long game, and it needs to be strategic. It needs to reimagine the Democratic party as well a strategy to empower unionization or some other form or forms of working class solidarity. In my Occupy group we’re going to watch this video soon to know what that might look like.

There’s real risk that if we don’t document and protect, we’ll have a disappointed and angry mob casting their anger and blame on minorities with impunity.

We can do this. We can smell the shit together.

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We are all activists now

Go bake your pie, your lasagna. Get your comfort food made, and check on the kids.

And then contribute to your favorite, most hard-hitting independent journalism organization, if you have money to spare. Look to the future, don’t dwell. Ignore conversations about what happened, about the mathematics of polling, of demographic nonsense. It’s time to prepare for whatever the hell is happening next. It’s up to us to focus, to value information over propaganda. Nobody else is going to do that for us.

Because we are all activists now.

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Aise’s Voting Guide

This is a voting guide my son Aise put together for me. He’s not old enough to vote so he made it to influence my vote. I thought he did a nice job distilling some real information, so I got his permission to post it here.


Presidential: Dan Vacek (Legal Marijuana Now)

New York Senate: Alex Merced (Libertarian)

  • He wants to legalize all drugs
  • He wants to have a very open border policy.
    • He says illegal immigration is like a black market, if you make something more or less legal, the black market will go away

New York House District 10: Jerrold Nadler (Democratic)

  • He has been a reliable progressive democrat. One example of this was his voting against laws that would have helped along the tpp. He also voted to stop the expansion of military suspending and voted to keep the Iran deal together.
  • His one opponent is Philip Rosenthal who favors entitlement reform, tearing up the iran agreement and whose website has the words on it “When America retreats, evil advances.”


State Senate District 30: Bill Perkins (Democrat)

  • He is running against Jon Girodes who was arrested for running a scam by taking people’s money to rent out an apartment and then not returning the money or giving them the apartment.
  • He sponsored legislation to allow people 16 and over to donate an organ.
  • He sponsored legislation to regulate emissions from cars.
  • He sponsored legislation to give inmates translation services in parole hearings.
  • He sponsored legislation to make it easier for the disabled receiving social security money to avoid rent hikes.

State Assembly District 69: Daniel O’Donnell (Democratic)

  • He supported legislation to allow convicted felons to vote once they completed their sentence.
  • He supported legislation to expand eligibility for “shock incarcerations.” A shock incarceration is when someone serves time in a treatment facility instead of prison.
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Fake News, False Information, and Stupid Polls

Fake News

Facebook uses an algorithm to decide what you see. It’s proprietary but my guess it’s optimized to keep you on Facebook for as long as possible.

This wouldn’t be a problem but becomes one when we realize that people get their news from Facebook.


When you optimize to something, and when you ignore something else, that other thing can be expected to balloon beyond recognition. We’ve seen that with ballooning tuition for colleges because of the US News & World Report, for example.

In this example, the thing Facebook has ignored is “truth.” The result is a proliferation of fake news:


False Information

Beyond simply fake news, there’s tons of hyper partisan articles that make use of false information. These pseudo-news sites have popped up simply to exist on Facebook and to game the Facebook algorithm.


When Facebook started 12 years ago, there was a much healthier journalism industry. It’s now much less healthy, in no small part because of the ad dollars that now pour into Facebook. What will another 12 years bring? I’m worried that we won’t have real news anymore even if we search for it.


This is bad for democracy, because people are constantly being misinformed or hysterically informed. It’s pushing people further into their corners, or pushing them off of Facebook and politics entirely.

Stupid Polls

Finally, the polling conversations are out of hand. We tune into our favorite radio shows to hear about policy and instead we hear about poll numbers, or even worse, debates between poll watchers about whose poll is more accurate. That’s not news.

We have obsessed over the college educated white Iowan women’s vote for long enough, and we need to enter a new phase where we discuss actual issues. Leave the polling to campaigns. Mona said it best:



What can we do?

Here are some ideas that might help a little but won’t solve everything. Tell me yours.

  1. Facebook absolutely must acknowledge its role in the spread of misinformation. They need to act as editors. This will take an army of workers, but there are plenty of journalists who are looking for jobs, and Facebook makes tons of money, so there’s no actual problem besides the will of Facebook.
  2. Beyond that, Facebook needs to redesign its algorithm so that people don’t only see things they already agree with. This echo chamber (or “filter bubble,” as Eli Pariser described it in his 2011 book) has had a terrible effect on political partisanship. We’ve ended up thinking people who don’t agree with us are actually bad people. Facebook should redesign its platform so that we talk and listen to each other more.
  3. We need to demand that media stop fixating on polls. If we can’t outlaw them, at the very least we can complain and move our attention to real information.
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