Compounding and Confounding Medical Errors

May 23, 2016
Just 5% of Terminally Ill Cancer Patients Understand Prognosis

Patients were asked what stage cancer they had, their current health status, how long they expected to live and if they had recently had a life-expectancy discussion with their doctor. Just 5 percent of the patients accurately answered all four questions about their disease and prognosis correctly.

5% sounds very optimistic. We're not done factoring in the rest of the errors yet. How about those doctors?

July 7, 2014
Do doctors understand test results?

Gigerenzer's research shows just how confused doctors often are about survival and mortality rates. In a survey of 412 doctors in the US he found three-quarters mistakenly believed that higher survival rates meant more lives were saved. He also found more doctors would recommend a test to a patient on the basis of a higher survival rate, than they would on the basis of a lower mortality rate.

Not done yet. Need to factor in defensive medicine.

One trend, evident in some health systems more than others, is for doctors to practise medicine "defensively", recommending treatments that are least likely to leave them open to being sued.

Not done yet. Need to factor in the lawyers.

February 2, 2013
Guilty as charged

According to a study in 2006, America has more lawyers per person of its population than any of 29 countries studied (except Greece), and it spends two to three times as much on its tort system, as a percentage of GDP, as other big economies (except Italy, where things are nearly as bad).

Not done yet. Need to factor in the Corporate America propaganda machine.



P.S. I'll probably get sued for saying this sarcastically, but it makes me feel real good, as an American, to share the lawyerin' top honors with Greece and Italy. Gives me great confidence in our long-term financial future, lol. Sigh.

Parabolic Trend Failure of the Day: Real Net Interest Income

The following chart shows the 10-year moving average of real net interest income (interest received minus interest paid).


Click to enlarge.

Check out that blue parabolic trend failure. With an r-squared of 0.99956, it's yet another parabolic sight to behold. It never ceases to amaze me how many unsustainable but nearly perfect parabolas this economy can generate. Okay, now on to the good stuff.

What does it mean if the red trend continues?

Although it is a parabola, it is one with a very long period (and the lower r-squared value implies more volatility). As more and more bonds are issued and more and more money floods into the banking system, the combination just isn't generating any additional real net interest though, at least not yet. Big shocker. If you believe that our empire is in a period of slow decline, as I do, this really shouldn't surprise you much. A slowly declining empire cannot support rising real yields. Ours can't even support steady real yields. They've been falling for decades.

Here's the good news though, if you can call it that.

1. Rome was not built in a day.
2. Rome did not fall in a day.

That's especially true in a world where the actual Rome isn't doing all that well. The rest of the world is setting the bar pretty low for us.

What have I chosen to do about this parabolic trend in red?

At every opportunity, I have locked in real yields on long-term TIPS and I-Bonds. It does not pay to procrastinate as real yields fall over the long-term. In my opinion, sitting in cash is the ultimate form of procrastination.

Much to the dismay of "bond bubble" prognosticators, so far the plan has worked out well. I suspect that it will continue to work out well. I could be wrong though. The economic dam has cracks in it. There's really no telling how long it can last. I'm 50. From a purely self-serving standpoint, I'd strongly prefer that the dam holds until at least 2050.

Bulls and bears alike should really be rooting for my plan to work, for if I am financially ruined holding a "safer asset" then I will not be going alone. I'll be taking a great many "risk asset" holders with me. (As I've stated before, the same does not work in reverse though. I do not depend on "risk asset" holders nearly as much as they depend on me.)

In any event, I continue to be extremely grateful that I was born when and where I was. I enjoy modern conveniences. I have no desire to move to China. I won't be bribing the border guard to get into Mexico. There are probably worse places to be on this earth if and when the you know what really does meet up with the fan. I definitely expect the fan to get plenty of use. I retired in 1999. There have certainly been plenty of things flung at it so far. Seriously.

This is not investment advice.

Source Data:
St. Louis Fed: Custom Chart

The Sarcasm Report v.173

November 14, 2012
RPT-CORRECTED-UPDATE 1-Congress, Obama face dynamite in 'fiscal cliff' -CEOs

A failure in Washington to solve the crisis by the year's end could prompt major companies to curtail investment plans, said Duncan Niederauer, CEO of NYSE Euronext, operator of the New York Stock Exchange.

"We simply won't be investing in the United States. We will be investing elsewhere where we have more certainty of the outcome," Niederauer said in an interview.

If certainty of the outcome is all that matters then Europe seems the perfect place to invest! Or perhaps China? Rain or shine, their official numbers always seem fantastic!

Sandy Cutler, CEO of manufacturer Eaton Corp, shared his concern.

"Until we solve the fiscal issues (in the United States and Europe), you're not going to get back to normal GDP growth," Cutler told investors on Tuesday.

Normal GDP growth? What a hoot!

July 27, 2012
Real GDP Growth per Capita


Click to enlarge.

Step right up! We're running a special on old normals and new normals! Borrow the money to buy the old normal at the regular price and get a new normal at that same low price!

The Sarcasm Report v.138

May 27, 2010
Pros See Opportunities in Battered European Stocks

Italy has a smaller fiscal deficit than either Ireland or Spain, for example, so it will probably have less cost-cutting—with a less pronounced impact on economic growth.

Here's a chart of Italy's stock market since the opportunities appeared.