Mortgage Default Economics

To default or not to default. That is the question.

Answer: If your house value falls sufficiently below your mortgage loan simple good business indicates that you should, indeed, default. When houses again regain value you would be financially better off defaulting than you would be by simply continuing your payments and waiting for recovery. The figure makes it clear.

It would be greatly to the lender's advantage to renegotiate the mortgage with the borrower. The lender could save himself the cost of foreclosure and resale of the property that way. Any rational lender would do so rather than foreclose. But the packaging of mortgages has decoupled lenders from borrowers thus precluding this remedy.

Sites worth visiting.

A focussed video search engine
http://www.glumbert.com/categories/

This site is beautifuly artful; graceful elegant and breezy.
phatterism.com

http://www.commoncraft.com/ Their "product is explanation" and they do a wonderful job at it. Well worth seeing as artistry of explanation.

Favorite Animations

http://uploads.ungrounded.net/221000/221483_Play.swf
http://www.mapsofwar.com/images/EMPIRE17.swf
http://alanbecker.deviantart.com/art/Animator-vs-Animation-34244097
http://www.gapminder.org/downloads/presentations/
http://www.visualthesaurus.com/
http://www.biomotionlab.ca/Demos/BMLwalker.html
moebius transformations

Measurement Problem 2

Here are Stephen's cogent remarks reprinted
Marvin's reponse follows it:

The point you make, namely, that you "cannot believe that an intricate mathematical subtlety can be at the bottom of the conundrum that something about the nature of making a measurement demands a re-zeroing of the state of the universe" is one I take issue with.

On the contrary, I believe that it is exactly as an "intricate mathematical subtlety" that ANYTHING involving the nexus between our classical minds and the quantum regime is likely to appear to us macroscopic beings. That is, in a form counter to our intuitions, which is what I take to be your meaning of the words "intricate" and "subtle".

We do not have the internal epistemology to apprehend the quantum world as it actually is. We would not have evolved if we had had it. All classical reductions like hidden variables theories, etc., have been disposed of. We are left with no classical fall-back positions to explain anything, so why should this punctus crucis of classical-quantum interchange appear simple to us in any way? Particularly as the classical "world" does not exist. It is a fiction of our particular evolutionary tree. All is quantum, as David Finkelstein was fond of saying. What words would you use to simply describe something like this? It would have to be entirely within the vocabulary of QM: and then you are back with Hilbert space and its intricacies, which are real. This is not a proof that it cannot be done, but it is strong evidence to my mind.

For further evidence, I would direct you to two of the best theorems in the subject: the Kochen-Specker No Go Theorem, and Gleason's Theorem on the representability of states in terms of density matrices in Hilbert spaces of dimension greater than 2. A lot of the best things we know about QM are based on these results, which are intricate in the extreme.

Suppose the proofs of whatever for instance Bub has done could be much simplified. Would you be happier? Or must it be an entirely non-mathematical explanation?

My own view is one of extreme operationalism adopted from Finkelstein. There are no objects in the actual world, only possible experiments. Therefore no "objective" observers. No observers, actually, only primitives called "experiments". Quantum theory is a language for describing possible experiments.

Response to Stephen's cogent remarks

I loved reading what you wrote. So very stimulating. I'm not sure that we disagree all that much. We both appreciate the fundamental notion that 'understanding' consists in discovering the mathematics that describes reality. But having discovered it we can ask what does it tell us about how to perceive reality. What's the story?

The process of discovery involves mind structures, ways of thinking, and especially postulates about reality. The "intricate mathematical subtlety" must have some narrative attached to it.



I offer a measurement problem animation to illustrate a narrative. Press the particle release button to have a vertically polarized particle traverse the field gradient region. Made visible here by icons is what is not measurable: the particle amplitude. The act of detection means that the particle gets merged into a large dimensioned hilbert space. How does this fact demand that one of the choices materialize? And if it is all causal, how is one or the other choice chosen? What is the substance of the matter? I find it hard to consider something explained simply by 'that's the way it works out'.

I need a satisfying picture, an acceptable narrative. A metaphore for the mathematics. It is not enough for me to be told, "Here look at the mathematical result." That's what generates intuition on the matter, a narrative.

Rovelli seems to have a narrative. But it is not clear to me how the measurement problem is resolved by the relativity of measurement.

Perhaps Stephen will give the substance of what the "Kochen-Specker No Go Theorem and Gleason's Theorem" tell us. I'd certainly appreciate understanding the significance of these two results.