Smyrna: A Greek tragedy witnessed by Americans

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20130323-120017.jpgIn September, 1922, Mustapha Kemal Ataturk, the victorious revolutionary ruler of Turkey, led his troops into Smyrna (now Izmir) a predominantly Christian city, as a flotilla of 27 Allied warships– including three American destroyers– looked on. The Turks soon proceeded to indulge in an orgy of pillage, rape and slaughter that the Western powers anxious to protect their oil and trade interests in Turkey, condoned by their silence and refusal to intervene. Turkish forces then set fire to the legendary city and totally destroyed it. There followed a massive cover-up by tacit agreement of the Western Allies who had defeated Turkey and Germany during World War I. By 1923 Smyrna’s demise was all but expunged from historical memor.
– Smyrna 1922: The Destruction of a City, Marjorie Housepian Dobkin

Estimates of Greek and Armenian deaths range from 10,000 to 100,000. Nearly 500,000 Greeks were forced to emigrate or detained in concentration camps.

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Prior to the Turkish conquest, Smyrna was a Greek commercial enclave on the Aegean coast of Asia Minor where Christians lived peacefully among the Turks. In fact, most ethnically Greek residents of Smyrna spoke Turkish as their primary language.

While Ataturk’s violence was extreme, it was not entirely unprovoked. Greek troops had wiped out a Turkish brigade in May of 1919, after the end of the First World War and claimed Smyrna as part of Greece. A military administration was formed by Greece in and around Smyrna.

The Greek premier Venizelos had plans to annex Smyrna and he seemed to be realizing his objective in the Treaty of Sèvres signed on August 10, 1920.[16] (However, this treaty was not ratified by the parties and replaced by the Treaty of Peace of Lausanne.)

From Wikipedia:

Smyrna (Ancient Greek: Σμύρνη or Σμύρνα) was an ancient city located at a central and strategic point on the Aegean coast of Anatolia. Due to its advantageous port conditions, its ease of defence and its good inland connections, Smyrna rose to prominence.

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The ancient city is located at two sites within modern İzmir, Turkey. The first site, probably founded indigenously, rose to prominence during the Archaic Period as one of the principal ancient Greek settlements in western Anatolia. The second, whose foundation is associated with Alexander the Great, reached metropolitan proportions during the period of the Roman Empire. Most of the present-day remains date from the Roman era, the majority from after a 2nd century AD earthquake.

Ignore the blogs

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I propose that if you want a simple step to a higher form of life, as distant from the animal as you can get, then you may have to de-narrate, that is, shut down the television set, minimize time spent reading newspapers, ignore the blogs. Train your reasoning abilities to control your decisions. Nudge “System 1”, the heuristic or experiential system, out of the important ones. Train yourself to spot the difference between the sensational and the empirical. This insulation from the toxicity of the world will have an additional benefit: It will improve your well being. Also, bear in mind how shallow we are with probability, the mother of all abstract notions. You don’t have to do much more in order to gain a deeper understanding of things around you.

– Nassim Taleb, The Black Swan

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A sure thing for $4 million. Or would you risk it?

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“Loss aversion is certainly the most significant contribution of psychology to behavioral economics.”
-Daniel Kahnemann
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Psychologist Daniel Kahnemann, with his partner Amos Tversky, earned the 2002 Nobel prize in economics for discoveries in the field of behavioral economics. His 2011 book Thinking Fast and Slow is a treasure for everyone seeking to understand the complicated and highly irrational nature of the economic brain.

Kahnemann’s biggest breakthrough came in the development of what is known as Prospect Theory.

In the 1730’s Daniel Bernoulli correctly showed that different levels of wealth have different levels of utility. Consider an increase in someone’s wealth by $1 million dollars: The person with zero dollars will have much greater utility for $1 million dollars than the man with $9 million who reaches the level of $10 million. The amount is the same, but the utility is much higher for the poor man.

Bernoulli’s Utility Theory found that the utility of wealth could be measured:
$ Millions = 1 2 3 4 5 6 7 8 9 10
Units of Utility: 10 30 48 60 70 78 84 90 96 100

So, if you were given this bet, the choice would be fairly simple:
A 50/50 chance to have either $1 million or $7 million, or a 100% chance to have $4 million.
$1 million x 50% is the utility unit of 10 x 50%
$7 million x 50% is the utility unit of 84 x 50%

(50% x 10) + (50% x 84) = 47 vs. 60 which is the100% certainty of $4 million.
You would choose the sure thing and take the $4 million.

Kahnemann and Tversky, building on the theories of Harry Markowitz, proved that Bernoulli’s theorem doesn’t take into account happiness resulting from a recent change.

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Imagine that Jack and Jill each have $5 million today. According to Bernoulli, both Jack and Jill have an equal level of utility. Now assume that yesterday Jack had $1 million and Jill had $9 million. Obviously Jack is ecstatic and Jill is miserable.

Kahnemann’s two key points:

1.Utilities are attached to changes in wealth rather than to states of wealth.

2.Losses loom larger than corresponding gains for the economic mind.

What if you had to have surgery on your knee to repair damaged ligaments. Say the doctor informs you that there is a 5% chance that you could lose your leg. How would you feel if he informed you that there was a 10% chance of losing your leg? The percentage change is the same, but the level of risk is perceived to be much higher in the loss-averse mind.

What if the doctor said the same operation has a 95% success rate? What if he said it was 90% successful? What does that make you feel? Framing the question has a major influence on your perception of risk. The use of a negative outcome is far more influential.

Insurance salesmen have plenty of customers.

I guess it’s Canada’s turn to have a housing market collapse

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It looks like Mark Carney has picked the perfect time to exit Canada and become head of the Bank of England…

Toronto is awash in real estate. There were 144 skyscrapers under construction in late February, more than in any other city in the world, according to SkyscraperPage.com. Proposals for new condos reached 253,768 units at the end of the fourth quarter, up 10 percent from a year earlier, Toronto-based research firm Urbanation Inc. says. Four luxury hotels, each featuring condos, have opened in the past two years.

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Source: Bloomberg Markets Magazine

The Coming Water Crisis That Will Change The Lives Of Every Person On The Planet

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I suggest that everyone read Michael Snyder’s synopsis of the water shortages that we are facing and will only get worse unless dramatic behavior changes occur. His post can be found at the Economic Collapse Blog.

Most troubling for us here in Nebraska is the massive depletion of the Ogallala Aquifer cited by Snyder. It has been the most crucial source of agricultural irrigation in the nation’s heartland and it faces extinction.
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Snyder writes:

In the United States we have massive underground aquifers that have allowed our nation to be the breadbasket of the world. But once the water from those aquifers is gone, it is gone for good. That is why what is happening to the Ogallala Aquifer is so alarming. The Ogallala Aquifer is one of the largest sources of fresh water in the world, and U.S. farmers use water from it to irrigate more than 15 million acres of crops each year.

The following are some facts about the Ogallala Aquifer and the growing water crisis that we are facing in the United States. A number of these facts were taken from one of my previous articles. I think that you will agree that many of these facts are quite alarming…
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1. The Ogallala Aquifer is being drained at a rate of approximately 800 gallons per minute.

2. According to the U.S. Geological Survey, “a volume equivalent to two-thirds of the water in Lake Erie” has been permanently drained from the Ogallala Aquifer since 1940.

3. Decades ago, the Ogallala Aquifer had an average depth of approximately 240 feet, but today the average depth is just 80 feet. In some areas of Texas, the water is gone completely.

4. Scientists are warning that nothing can be done to stop the depletion of the Ogallala Aquifer. The ominous words of David Brauer of the Ogallala Research Service should alarm us all…

“Our goal now is to engineer a soft landing. That’s all we can do.”