The Looting Continues

I'm astonished by the subdued public response to the extraordinary events of recent times: we have been, and are being, looted on a scale hitherto unheard of in peacetime.

Two excellent posts from econ blogs do a brilliant job of explaining what's gong on.

First, this is a great post on the AIG situation by Yves Smith. Smith is ex-Goldman, ex-McKinsey and was head of M&A at Sumitomo, so is no pinko:

http://www.nakedcapitalism.com/2008/11/aig-looting-continues.html

Next, Steve Waldmann looks at the implications of the bailout more generally:

http://interfluidity.powerblogs.com/posts/1226367450.shtml

His discussion of what government investment means is superb: the bailout is a disaster for all of us even if it turns a slight profit. And the distributional consequences - bad as they already are - may get a lot worse.

I don't really have anything to add except a question: why aren't people enraged by all this? It's not hard to get a sense of roughly what's going on, is it?

Financial innovation

Behavioural economists Richard Thaler and Cass Sunstein hav a piece in today's FT:

http://www.ft.com/cms/s/0/ac2839ac-b015-11dd-a795-0000779fd18c.html

On financial innovation:

Not so long ago, most mortgages were of the 30-year fixed-rate variety. Shopping was simple: find the lowest monthly payment. Now they come in countless forms. Even experts have trouble comparing them ...

Which begs two questions (i) what purpose did the added complexity serve and (ii) what to do going forward? Their response:

A potential response to complexity would be to require simplicity – for example, by allowing only the standard 30-year fixed-rate mortgages. This would be a big mistake. Eliminating complexity would stifle innovation. A TiVo is a more complicated product than a VCR, but it is also better.

This analogy seems to me just a little inadequate as an explanation of the value to society of the very changes in the financial system which have been at the heart of a meltdown whose costs (direct, opportunity and otherwise) are as huge as is now becoming clear.

System complexity and highly attractive incentive and tax regimes come at a cost. The former can lead to unpredictable outcomes, the latter to perverse behaviour, in the worst case undamped by either social norms or tax structure, and the two together to the massive economic damage we are now witnessing.

So you have to justify these things. Why do we need complcated mortgage deals? Why must we allow banks to trade obscure derivative products? Clearly there are huge costs in terms of failures of this kind? Can we quantify the benefits? Are they really large enough to be worth it?

Ditto incentive and tax structures. Clearly you want outstanding people to be incentivized to do things that make us all better off. But if you're going to argue in favour of a system in which bonuses alone far exceed the entire amount spent on all scientific research and positively dwarf what we spend on alternative energy, you have to justify it: what do we get from the activities of these people and these organizations that is so superior to simpler and less lucrative alternatives?

Baker has to go

How can this guy be a column writer for the Times?

http://www.timesonline.co.uk/tol/comment/columnists/gerard_baker/article4958311.ece

So we are about to witness something extraordinary. America ... is about to have the most left-wing government in what used to be called the industrialised world. ... In Europe, Conservatives rule in Germany France and Italy, and despite the miraculous recent apparitions of the Dark Lord Mandelson of the Manipulative Genius and Saint Gordon of Perpetual Financial Succour, the Tories still look likely to take over within the next two years. Meanwhile, across the Atlantic, a fully Democratic Government will take office with a domestic agenda that would make European hearts pine nostalgically: huge expansion of healthcare; a vast programme of public investment in modern energy technologies; a liberalising social agenda to be pursued, as is now customary, through stacking the courts with politically activist judges.

Anyone who's spent any time in any of these countries, or even just reads the newspapers would know that nothwithstanding the fact that the Democrats are to the left of the Republicans, there's no way an Obama government would be more left wing than the Merkel government in Germany or even a Tory government here. This is just stupid.

Horse race reporting from the BBC

On a BBC TV news programme a couple of nights ago something to the effect that the Obama and McCain economic plans aren't that different but that "Obama does empathy better".

Three hundred BILLION in tax cuts for the wealthy vs. tax cuts for the majority; a promise to end a three TRILLION dollar war asap vs. at some point one day maybe in a "hundred years"; a real national healthcare systems vs. continuing with the most expensive and least fair system in the developed world.

How different do their policies have to be before news coverage moves away from "he said, she said" and "on the other hand" nonsense to saying something substantive?

We rightly call out leaders from non-western countries when they're being crazy, why are we so afraid to say that today's Republicans are simply not fit for government?

An emerging narrative

Nicholas Nassim Taleb doesn't seem to be a big fan of the financial sector, but in one way the notion of the "Black Swan" he has popularized is helping to weave a narrative which provides cover for the looting carried out by the sector. It goes like this: the crisis was fundamentally unpredictable, a real Black swan event, so who could have known? Shrug. Call in the government. Wait a couple of years. Start looting again.

This is a huge distortion of what has really happened. While the full extent of the crisis has been a surprise I think to most people, the underlying issues - a house price bubble, crazy short-term incentives and a mass capture of national wealth by the finance sector - have long been recognized by a number of commentators. Of course, the ruling elites have never wanted to hear these views, so for some years they've filled the opinion pages of WSJ, FT, London Times, Telegraph etc. with hand-picked cheerleaders for the looting. Now that the sleight of hand has become plain to see, the story has switched to this one of complete unpredictability.

The problems with the finance sector were no Black Swan. The sector's been sucking the nation dry for some years, and with a compliant government buying into it's story has driven (i) a crazy house price bubble, (ii) a huge misallocation of human capital (read smart young people) away from other tasks (health, energy, research, training, transport) into an increasingly zero-sum, if not negative-sum financial game, (iii) a capture of wealth (something like 40% os all UK corporate profits, and that's after paying out those huge salaries; finance adds some value, but that much relative to everything else?) leading to the remarkable phenomenon of stagnant real wags at a time of increasing productivity and (iv) a broader corruption of the public sphere in which taxes are seen as nothing more than a drag on the economy, leading to under-provision of public goods at a time when they're needed more than ever.

Beware the emerging narrative. The underlying causes of this mess have been evident for years, and need to be addressed as soon as possible.

Housing madness continues

UK house prices are way out of line. It's a bubble, it's distorting the economy and is one of the underlying elements in the financial crisis. Banks whose assets include IOUs on houses are not going to get all their money back. For that reason their assets are worth less than was thought by optimists during the bubble. It's going to get worse before it gets better: people are going to default, banks are going to have to face up to reality, sellers are going to have to face the fact that people are not going to pay five times their salary for a place to live and so on.

Yet the government seems determined to keep the bubble inflated. It appears to be insisting that the two newest branches of the government, HBOS and RBS, keep lending at 2007 levels, i.e. too much. I can understand that you'd want to "smooth" the house price crash, and I hope this is what they have in mind, but it looks awfully like a desperate attempt to keep the bubble going.

Newsnight had a couple of house price cheerleaders on last night: an estate agent and some guy who wrote a book called "How to make a million in housing" or something like that. And these guys of course are gung ho about the housing business being the backbone of the economy and so forth. The presenter asks a perfectly reasonable question: why not follow other countries which have long imposed fairly hard rules on how much you can borrow (effectively as a damper on bubble formation)? Guests just ignored the question and keep shaking their pom poms. What a joke. This is like asking thieves about preventing robberies. Meanwhile Yvette Cooper refused to even say that there's something wrong with 125% mortgages.

House prices will drop. It's only a questio of how long psychology and government intervention keeps them artificially high and how much broader economic damage is caused in the meantime.

An oldie

From this blog in August 2007:

The labour market distortions induced by extremely high wages in the finance sector are worrying. Put simply: is it really efficient to have legions of bright young physicists and engineers (usually trained at great public expense) slugging it out in the City in the hope of a becoming lucky young millionaires instead of doing research on, say, sustainable energy, or designing genuinely innovative new products?

http://compulsivetheorist.blogspot.com/2007/08/masters-of-universe-ii.html

Arm twisting

A question is being asked about the consumers who over-stretched to take on huge mortgages which goes like this: no one was twisting their arms to take on these loans, isn't there an element of personal responsibility? Sure there's some element of personal responsibility but let's not pretend that decisions to take on huge loans are made in isolation. If everyone else is taking out huge mortgages, house prices go up, and for an individual family the choice is to follow suit or live in a bad neighbourhood (say). Mortgage decisions are in this sense coupled: the prices of homes depend on how much others are willing to borrow, so the prudent have to pay a very high price, in terms of quality of life, possibly for a long period, before a house price bubble deflates and their prudence pays off. This simple fact limits the negative feedback we can expect to see cautious borrowers exert.

Worse, in the UK, the house buying mania is so deep seated that it's actually very difficult to raise a family in rented accomodation. The rental market for familiy houses is thin and the tenancy regulations not great for people in that position.

If even prudent individuals feel compelled, for quite rational reasons, to buy at inflated prices, you know you've got huge systemic problems!

I suggest:

(1) Act to make the rental market bigger and better. There needs to be a range of rental options at every level. The option to rent has a key role to play in controlling house prices inflation during bubble formation, by drawing the prudent out of the market.

(2) Impose limits on how much people can borrow. Mortgage borrowing is akin to an arms race: you need to control how much people can bid, or in small, locally rational steps, they'll bid prices up so high it hurts most of us.

(3) Simplify the mortgage business. How does the huge layer of brokers and other intemediaries add value? If there isn't a clear answer, get rid of them, and move to a simpler, stripped down mortgage service, using new regulation if needs be.

Bursting the bubble

Gordon Brown is being widely praised for leading Britain's relatively well thought out bank bailout. However, it's worth remembering that Brown was Chancellor the whole time the huge house price bubble was inflating. Basic indices (house prices relative to rents, incomes etc.) have been hugely over trend for some time, and the lines of Roubini, Shiller and Krugman have been sounding warnings about the bubble for years.

Against that background, you have to criticize Brown for not taking action earlier to control rampant house price inflation. Quite apart from the fundamental role this has played in the crisis, excessively high house prices have also caused huge distortions in the economy, resulting in vast transfers of wealth and misallocation of resources.

Among other things, this means that we now need to begin taking steps to deflate the bubble. Clearly, you don't want to do this too fast - that would be too much of a shock and would probably push us into a terrible recession - but we do need to get house prices back to the right level (i.e. close to trend). As of now, we're not hering anything about this from the government, but I hope we will once things have settled down a bit.

Outrage

This crisis has awakened me form my blogging slumber. What's going on is outrageous.

Our banks are no longer viable entities. They have now been promised vast sums of our money, through a variety of schemes. Yet the bankers who created the whole mess are not really losing very much, and are, at this very moment, continuing to receive large salaries. There has been no guarantee of a moratorium on bonuses, only vague words. Am I wrong to think that at the very least, these rescue schemes should work as follows. Firms should be free to sign up or not, but if they do want to take huge chunks of public money to recapitalize, they should see salaries capped, across the firm, at the top civil service rate, say. Furthermore, they should open up their books to a comprehensive investigation by a new investigative unit (if we're spending this kind of money, we can afford something like this - think of it as a Keynesian stimulus), with a remit to prosecute actions that were either truly fraudulent or simply cases of gross irresponsibility, criminal charges in the first case and civil in the second. Firms that do not wish to be exposed in this manner, or who do not wish to cap their wages, would be free to take their chances in the open market (I understand it's important that a critical mass of banks get back on their feet, but putting the scheme this way frames the issue correctly: while it's necessary, it's also the government doing the sector a favour.)

Yet this is not what is happening, certainly not in the US, and not even here in the UK. Two nights ago a senior banker on Newsnight explained, with a straight face, that all this talk of doing away with "$2m bonuses" and so forth would come to nothing because that is how "it works" in the City.

These people beggar belief. They are not only the biggest theives seen in the history of business, but have so convinced a generation of political leaders with their pseudo-economics (unfounded, as far as I can tell, in either theory or empirical evidence) that it seems that even after what has happened the moral response has been muted.

Back to school

A perennial debate in the UK concerns private, fee-paying versus public, government-funded schools. The former are often academically strong (but of course don't have to deal with the full range of students to which government schools must cater) but find themselves blamed for a number of social ills related to equality of opportunity, social mobility and so on.

Here's an attempt to at least describe the trade-offs involved in the schools issue. I'll start off by saying I don't know what the answer is, but am for now simply trying to pose the question.

It seems to me there are two issues here: (i) (academic) selectivity (selective or non-selective) and (ii) fees status (fee-paying or free). These dimensions are often discussed together, but I think it's useful to consider them one at a time. All four combinations are possible: German gymnasia and the old English grammar schools are examples of free, selective schools; equally, one can imagine fee-paying schools which accept any student who can bear the cost, regardless of academic ability (the other two combinations are the conventional ones: free, non-selective, and fee-paying, selective).

What I want to do first is consider the possible costs and benefits of selectivity and fees, with some first thoughts on how important those effects might be in practice. I'll then sum up with some (tentative) conclusions.

First, what are the costs of selectivity? One is an "external cost" to the remaining, non-selective schools. If we assume some fixed number of academically able students, simply by bringing together such students in one place, selective schools must reduce their proportion elsewhere. To the extent that the presence of such students benefits the class as a whole, there must be some cost associated with selectivity. On the opposite side of the ledger there is an external benefit: bringing together academically inclined kids may help them achieve their best, and protect them from some of the schoolyard problems such students sometimes face.

How important are these effects? My feeling is that the number of academically inclined kids is sufficiently small that the effect of spreading them out in a non-selective system must surely be small. How much difference can it possibly make to have one or two academic kids in a typical classroom? On the other hand, the positives of having at least some environments in which these kids can excel are considerable. We should all want smart kids to achieve their full potential: even someone who hates studying would surely want the person operating on their heart, or designing their car, or in charge of their country's energy policy to be as capable as possible. I would tentatively conclude then that selectivity is overall probably a benefit.

But what are the costs of selective schools being explicitly fee-paying? Suppose you hold academic ability constant and look at the effect of parental income. Under a fee-paying system, does having richer parents confer a better chance of attending a fee-paying selective school? If yes, then there is a serious issue to be addressed. We surely don't want to place yet another hurdle in the path of bright, poor kids, and equally we should want to find the most able students in the country, no matter what their parents financial status. How big is this effect? While most fee-paying schools have some scholarships for poorer students, I don't think anyone would argue that the chances of attending such schools is neutral to parental income in the sense I've described above.

So what we need is some way of making it easy for bright kids to attend selective schools regardless of parental income. One approach would be for the government to directly pay privately-run schools the fees for students who are good enough to get in but can't pay. The downside of this approach would be the usual difficulties of enforcement and means-testing: such things are clunky and lend themselves to being "gamed". Alternatively, selective schools might be government funded and free to attend. (A possible downside might be a loss of competition: fee-paying schools presumably have to work hard to keep parents happy. Some would say a government-run school might have a captive audience and not really care about how well it's run. But equally, there are plausible market-failure type arguments against fee-paying schools).

On to tentative conclusions. I think it's fees, and not selectivity per se, that is the key issue. Two possibilities are (i) government grants for poor kids to attend privately-run schools and (ii) selective schools which are free to attend. I would be in favour of having both approaches and seeing what works: it's hard to know in advance just how difficult grants would be to administer, or how effective government-run schools would be compared with their private counterparts.

Thus, I think an at-least reasonable solution is to have selective, government-run schools which are free to attend (but which students are free to choose between), and privately-run selective schools with full grants available for poorer students.

What women want

Via the Freakonomics blog:

Richard Gray at the U.K. Telegraph reports that Sir David King, a University of Cambridge chemist, staunch global warming activist, and one of Britain’s top government scientists, gave the following advice to a woman who asked him what she could do to curb global warming:
“Stop admiring young men in Ferraris.”

A general point here is that I don't think women fully realise the massive collective influence they have on (heterosexual) men via their sexual decisions. Men are very powerfully motivated by the desire to impress women, I think even more than they generally, half-jokingly admit. David King touches on one male behaviour pattern he'd like to see changed, I'm sure you can think of many more. Advantaged men playing fast and loose with the rules, dodging taxes, ripping people off? Disadvantaged young men showing no interest in learning things and instead wreaking havoc on the streets? Men being generally violent, whether outside the pub or with their own families? How different would the motivations to engage in these kinds of behaviours be if within the relevant social groups women treated such men with complete sexual indifference? That is, in each case, if the behaviour led to the man being treated as though he were short, fat and profoundly ugly. Note that in all three cases, if the anti-social behaviour were pointed out, many women would disapprove, but what matters is what they do - revealed preference in econ jargon - and in all three cases I'd argue that it's not the case that such men are shunned. You could even make a case that (perversely) some aspects of these kinds of behaviours are rewarded by women.

Of course, even if it were true that women could exert some influence in this fashion, it would not follow that they ought to. It is the men in these cases who are at fault. But it's an interesting thought that women collectively have a powerful policy lever available.

DRiving Me nuts

Itunes' Digital Rights Management (DRM) is driving me nuts. For various reasons I'm sick of the Ipod, but if I switch to a different player, I won't be able to listen to the many songs I bought on Itunes. This is ridiculous: it would be like buying a CD in a Virgin store and only ever being able to play it on a Virgin-branded CD-player. I know there're ways around this, but that's not the point. The point is that DRM as currently implemented on ITunes is immensely clunky.

I'm a guy who loves music and is very happy to pay for it. I want a seamless, easy experience, but that is not what I'm getting. The result? I buy far less music than I might otherwise, because the whole business now just has this association with aggravation in my mind. I can't be the only one: and as bad as I am, I'm surely not the least tech savvy user out there. What all this means is that the music companies are losing out on good business: they're throwing the baby out with the bathwater.

This rant's been bubbling nuder for a while, so I was delighted to find that computer security expert Bruce Schneier (speaking of course from a much better informed position) broadly agrees with me:
http://www.schneier.com/essay-157.html

So what's going on? Schneier says "I don't see the market righting this wrong", and I have to agree. The prize at stake is near-monopoly control of a sector for at least a while. Apple have it right now with digital music; Microsoft want it with movies. For consumers the problem is this: every company, no matter how innovative, wants to push out it's competitors any way they can: what is most profitable for an individual firm may not be the best route for the industry as a whole or for consumers generally. So paradoxically, today's innovators can turn into tomorrow's monopolists.

In my view, this is what's happening to Apple. Given the technology available today, it's a crying shame that digital music is such a pain. At the very least there ought to be multiple online music vendors with industry-wide catalogues, and open standards giving the ability to play purchased songs on any piece of hardware. This would in turn trigger off intense competition on the part of (i) the online stores, who would have to strain every creative sinew to provide a fantastic music browsing experience, and (ii) the manufacturers of players, who'd be competing on hardware alone.

Maybe the only solution is from outside the market: regulation to make it mandatory to allow purchased digital music to be played in standard formats. Then, let the market work its magic.

Counterintuitive data: strikes edition

Check out this graph from the Economist:

I find these data pretty surprising:
* Three countries - Germany, Netherlands and Sweden - with strong labour protections lose fewer days to strikes than the US or UK
* Germany and Japan seem to lose something like an order of magnitude fewer days to strikes than the US (!)
* France is just a touch above the OECD average, losing a little bit more than the US, but fewer days than either Australia or Ireland

Is it just me or are these numbers just a little counter-intuitive? I would have expected countries with strong labour protections to lose more days to strikes, and for France in particular to be an outlier. I would have expected the US, and to a lesser extent the UK, Australia and Ireland, all thought of as places where it's easy to hire and fire workers, to lose far fewer days to strikes.

But that's not what we see in the graph. Are these numbers right? Or is this one of these things like unemployment where off-the-shelf numbers need careful interpretation?

(The right would expect easy hiring and firing, weaker worker protections etc. to mean less unproductive striking, with the market taking care of who should get how much etc. The left would expect more strikes in countries with the "worker friendly" policies they like, but they'd view those strikes positively as a mechanism by which workers collectively express preferences. Surely both camps would find these data a little surprising?)

Relative and absolute poverty

I've never understood the notion of absolute poverty, as opposed to relative poverty. The absolute poverty rate is defined by Wikipedia as quantifying "... the number of people below a poverty threshold, and this poverty threshold is independent of time and place. For the measure to be absolute, the line must be the same in different countries."

But what is it that is absolute about absolute poverty? As I understand it, absolute poverty is calculted using a basket of goods type of argument: if you can't afford to buy enough to feed yourself (say) you're absolutely poor. But the amount and quality of food which counts as "feeding yourself" changes with time and place. How much is enough? Raw calories? Enough protein? Fresh fruit and vegetables? The first two were a luxury until recently, the fact that they're now regarded as things everyone should be able to afford is an inherently relative concept. Most people can afford to obtain them, so you are poor if you cannot.

What of education for your child? I suppose being unable to buy books or send your child to school would count as absolute poverty (if education was private, and formed part of the basket of goods and services). But again, these are things which were a luxury not too long ago and still are in many places. So why do we draw the line where it is, and not at say access to violin lessons or playing fields or small class sizes?

My point is that the notion of poverty is inherently relative. The absolute poverty line is determined by social convention, implcitly relative to what others in society can afford. How large a gap is tolerated between those at the poverty line and the median, or some higher rank position, is convention and nothing else. Surely all poverty is relative, or am I missing something?

Tucked away in the FT...

Tucked away in the Financial Times:

EUROPE: YOUTH AT WORK
By Simon Briscoe, Financial Times
Published: Mar 18, 2006

The proportion of French youths without work is more in line with other countries than suggested by official figures that put French youth unemployment at more than 22 per cent, compared with 11, 12 and 13 per cent in the UK, US and Germany, writes Simon Briscoe, Statistics Editor.

FT research suggests that 7.8 per cent of under-25s are out of work in France. This is only slightly above 7.4 per cent in the UK and 6.5 per cent in Germany.

The discrepancy reflects the fact that France has a much smaller youth labour force than other countries because a greater proportion go on to higher education after the age of 16, delaying their entry to the labour market.

Now, think of how often you've heard the factoid that 1 in 4 French youths is unemployed or whatever, and how rarely you've heard the point made above. I repeat, for emphasis "7.8 per cent of under-25s are out of work in France. This is only slightly above 7.4 per cent in the UK and 6.5 per cent in Germany" (the corresponding number in the US is around 7.4%, as far as I know).

Why is one particular and highly misleading spin on the numbers so widely disseminated? Your guess is as good as mine, but it's weird.

Why does banking pay so well?

Superb article from Martin Wolf in the FT:

http://www.ft.com/cms/s/0/3da550e8-9d0e-11dc-af03-0000779fd2ac.html

He starts with the question: "Why does banking generate such turmoil, with the crisis over securitised lending the latest example? Why is the industry so profitable? Why are the people it employs so well paid?" and goes on to suggest the answer is "banking takes high risks. But the public sector subsidises this risk-taking. It does so because banks provide a utility. What the banks give in return, however, is gung-ho speculation.".

The key point is that (Wolf again; I can't put it any better): "banks benefit from sundry explicit and implicit guarantees: lender-of-last-resort facilities from central banks; formal deposit insurance; informal deposit insurance (of the kind just extracted from the UK Treasury by the crisis at Northern Rock); and, frequently, informal insurance of all debt liabilities and even of shareholders’ funds in institutions deemed too big or too politically sensitive to fail... if things go well, shareholders earn exceptional returns. If they go badly, the downside cannot exceed their equity. Beyond that point, creditors and government share the losses."

This goes a long way towards explaining why bankers are paid so well: during times of profit, banks can pay out crazy wages and bonuses. However, the government guarantees Wolf alludes to above in effect put a lower bound of zero on remuneration: bankers don't ever have to pay back earnings (i.e. receive negative wages), no matter how thinly capitalized their industry or how bad their decisions turn out be. Wolf again: "...a run of profitable years in which shareholders receive high returns and employees are handsomely rewarded. Then comes the year of the locusts ...since they do not receive negative pay, they are able to keep their earlier gains."

An unexpected ally...

It seems as though Bill Gates' dad - of all people! - is on my side about inheritance tax:

http://www.responsiblewealth.org/commonwealth/index.html

Apparently Gates senior's view is:

"...individual wealth is a product not only of hard work and smart choices but of the society that provides the fertile soil for success. They don't subscribe to the "Great Man" theory of wealth creation but contend that society's investments, such as economic development, education, health care, and property rights protection, all contribute to any individual's good fortune..."

Exactly!

Where are the doctors?

Here's a curious fact. The UK and US are both countries where doctors get paid very well: UK is (anecdotally) #1 in Europe on this count (or close), and US doctors are certainly far better paid than their European counterparts. Yet the UK and US - and here's curious bit - are not the countries with the most doctors per capita. Germany - to take one example, there are others - has more docs than either the UK or US. The difference is actually quite striking: Germany has 3.4 practicing doctors/1000 people, the UK and US each have 2.4 (numbers from OECD). This is a huge difference of 42%. Absent any fundamental scarcity, a high wage for a given profession should increase the supply of labour and thereby reduce wages. If this is what's happened in Germany, why doesn't it happen in the UK and US? Given the rewards on offer, why don't more people become doctors in these countries?

Vacation

I'm always ranting about vacation time. Well, here's where the theory gets put into practice: I'm away for 12 days starting tomorrow (ok, it's not three weeks, but it's a start!), and no, I'm not taking a laptop...