Streetwise Professor

January 8, 2014

Thanks, Felix, For Showing What a Total Weasel David Kocieniewski Is

Filed under: Commodities,Derivatives,Economics,Energy,Exchanges,Politics,Regulation — The Professor @ 8:44 pm

Felix Salmon posed several questions for David Kocieniewski about his scurrilous article about Scott Irwin and me.  And-shockingly!-David Koscieniewski refused to answer a single one.  Not. A. Single. One. So if you don’t win that Pulitzer, Dave (and we know that’s what you want, isn’t it?), there’s always the Royal Order of the Weasel ready to be claimed.  You should be a runaway. Emphasis on the Runaway!

Instead of actually answering direct questions posed to him, our dear David doubled down on insinuation, innuendo, and ad hominem.  That’s our boy: go with what you got, eh?

I will respond more fully later, through multiple channels, but a few comments are in order now.

  1. Kocieniewski insinuates that I have violated the American Economic Association disclosure guidelines.  Fail, Dave. Pure fail.  The AEA guidelines require disclosure of any support (financial, in the form of data, etc.) on submissions to peer reviewed publications.  I have not submitted any work to a peer reviewed publication that has been supported by any party with an interest in the speculation debate.  I told you this during our interview.  So what is it?  Is David ignorant, stupid, or dishonest?  I can’t answer that.  Those are all observationally equivalent.
  2. I responded to all FOIA requests, forwarded to me via the University of Houston’s general counsel’s office, in a timely fashion.  Any suggestion to the contrary is false.
  3. My work for “one of the largest commodity exchanges” had nothing to do with speculation, and occurred after my positions on speculation were public.  Years afterwards.  Years.  As in plural.
  4. My work for “one of the largest commodity trading houses, Trafigura” occurred years after my positions on speculation were public.  Again, years plural.  I had no contractual relationship with Trafigura until September, 2013.  Um, I testified before Congress on speculation-testimony which gives dear David the faints-in July 2008.  You know, five freaking years before. And that’s not even the best part! Trafigura is not a speculator.  It is a hedger.  It routinely sells massive quantities of futures to hedge its massive quantities of oil transactions.  But-correct me if I’m wrong (but I’m not)-Kocieniewski’s article focuses on how speculators drive prices up by buying futures.  Hedgers. Speculators. Buy. Sell.  Up. Down. Whatever, eh? It’s all the same to our Dave. So again: David Kocieniewski: ignoramus, idiot, or liar? I say again: Observationally equivalent.
  5. Kocieniewski explicity refers to  the fact that “this debate [over speculation] began more than five years ago.”  Excuse me, but I wrote my first blog post on this in August, 2006.  I know you are math challenged, David (I read your piece on Goldman’s warehouse operations), but using the fingers on your left and right hands, you should be able to cipher that that works out to about 7 years (and about four months, but hey, let’s round down!).  So I weighed in on this before “the debate began.”  Just call me prescient.  But here’s the point: how did my (non-existent) consulting work on speculation years later affect my opinions?  Do you have issues with the concept that the cause must precede the effect?

More later.  I’m just getting warmed up (spits into palms, old school style).

Thanks again, Felix.  The cat caught the weasel.

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  1. Putting your facts in the way of David’s good story, yes Prof?

    Bloody spoilsport. How dare you.

    No wonder he’s sent you and Felix to Coventry.

    Comment by Regulator on Lunch Break — January 8, 2014 @ 9:58 pm

  2. @Regulator. LOL. Exactly: facts are so inconvenient to David. And I’m not just a bloody spoilsport. I’m spoiling for bloodsport!

    The ProfessorComment by The Professor — January 8, 2014 @ 10:20 pm

  3. OK, it’s on! Am cheering for you.

    If you’ll forgive some sweeping generalisations made in the interests of brevity: Two constants in the thinking of those on the left is that they hold a monopoly on truth, and that no person of goodwill could possibly hold a position contrary to their own.

    So anyone who disagrees with them could only argue such a contrary position out of base self-interest. Hence, your position on speculation can only be the result of your having been paid to argue that position.

    Evidence to the contrary ‘does not compute’ in their minds.

    You’ve got your work cut out for you!

    Maybe giving David some instruction in the ‘Fallacy of Affirming the Consequent’ might be a way forward.

    More strength to your, um, keyboard.

    Comment by Regulator on Lunch Break — January 9, 2014 @ 5:16 am

  4. As regards to speculators and prices, I think this has been going on for a bit longer than 6 years – see Deuteronomy. The general rule is that the faster the attacks degenerate into ad hominem, the bigger the idiot making them, the more intellectually dishonest, and or ignorant. as you point out, these are observationally equivalent (nice phrase!). Remember Napoleon’s adage: “Never assume malice when something can be explained by stupidity.” of course, Dave seems like both.

    I love the idea that you are attacked incorrectly for being in the pocket of the “big” speculators, whoever they may be. And this from the Daily Krugman(ex Enron), er, NYT of all places. A man is really defined by ones enemies, and being on the Punch and Pinch Sulzberger sh*t list is a much higher honor than any gong the Queen of England could give you. Mazel tov!!

    Comment by Sotos — January 9, 2014 @ 9:40 am

  5. @Sotos. Oh I know. On the blog and in other writings and in numerous speeches/talks I have referred to the anti-speculation attacks as “a hardy perennial.” I have posted several times on the anti-speculation campaigns in the 19th and early-20th centuries, and also written a couple of posts discussing Adam Smith’s analysis of speculation, which examined laws going back to the Platagenets. Haven’t done Deuteronomy yet 😉 Great idea for a future post!

    I only meant to say that I have had a public position on this going back to 2006.

    All the rest, spot on. Especially Dave’s malice-stupidity twofer. That’s a truly malign combination, especially when it has a forum in the NYT.

    The ProfessorComment by The Professor — January 9, 2014 @ 4:29 pm

  6. I just read math professor Ian Stewart’s 17 Equations That Changed the World. The chapter on Black-Scholes is full of nonsense and makes me wonder if he’s screwed up comparably in the areas where I’m even less informed. But on internal evidence–the thoroughness of his technical explanation of the equation relative to say, Navier-Stokes–I suspect that he is indeed less reliable on derivatives. Back in 1987 my wife wrote an editorial about anti-computer-trading hysteria called “The Witches of Wall Street.” The witch-hunt psychology hasn’t changed much.

    Comment by srp — January 13, 2014 @ 9:20 pm

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