Gypsy

Gypsy

By Carter Scholz (excerpt)

The launch of Earth’s first starship went unremarked. The crew gave no interviews. No camera broadcast the hard light pulsing from its tail. To the plain eye, it might have been a common airplane.

The media battened on multiple wars and catastrophes. The Arctic Ocean was open sea. Florida was underwater. Crises and opportunities intersected.

World population was something over ten billion. No one was really counting any more. A few billion were stateless refugees. A few billion more were indentured or imprisoned.

Oil reserves, declared as recently as 2010 to exceed a trillion barrels, proved to be an accounting gimmick, gone by 2020. More difficult and expensive sources – tar sands in Canada and Venezuela, natural-gas fracking – became primary, driving up atmospheric methane and the price of freshwater.

The countries formerly known as the Third World stripped and sold their resources with more ruthless abandon than their mentors had. With the proceeds they armed themselves.

The US was no longer the global hyperpower, but it went on behaving as if. Generations of outspending the rest of world combined had made this its habit and brand: arms merchant to expedient allies, former and future foes alike, starting or provoking conflicts more or less at need, its constant need being, as always, resources. Its waning might was built on a memory of those vast native resources it had long since expropriated and depleted, and a sense of entitlement to more. These overseas conflicts were problematic and carried wildly unintended consequences As the President of Venezuela put it just days before his assassinations, “It’s dangerous to go to war against your own asshole.”

Tango. Photo by Elena

The starship traveled out of our solar system at a steep angle to the eclipse plane. It would pass no planets. It was soon gone. Going South.

…

So: Shackleton Crater. It was a major comm link anyway, and its site at the south pole of the Moon assured low ambient noise and permanent line of sight to the ship. They had a Gypsy there – one or their tribe – to receive their data.

The datastream was broken up into packets, to better weather the long trip home. Whenever Shackleton received a packet, it responded with an acknowledgement, to confirm reception. When the ship received the ACK signal – at their present distance, that would be about two months after a packet was transmitted – the confirmed packet went back to the end of the queue, to be retransmitted later. Packets were time-stamped, so they could be reassembled into a consecutive datastream no matter in what order they were received.

But no ACK signals had been received for over a year. The buffer was full. That’s why she was awake.

They’d known the Shackleton link could be broken, even though it had a plausible cover story of looking for SETI transmissions from Alpha C. But other Gypsies on Earth should also be receiving. Someone should be acknowledging. A year of silence.

Going back through computer logs, she found there’d been an impact. Eight months ago something had hit the ship. Why hadn’t that wakened a steward?

It had been large enough to get through the forward electromagnetic shield. The shield deflected small particles which, over decades, would erode their hull. The damage had been instantaneous. Repair geckos responded in the first minutes. Since it took most of a day to rouse a steward, there would have been no point.

Maybe the impact hit the antenna array. She checked and adjusted alignment to the Sun. They were okay. She took a routine spectograph and measured the Doppler shift.

0.056 c.

No. Their velocity should be 0.067 c.

Twelve years. It added twelve years to their cruising time.

She studied the ship’s logs as that sank in. The fusion engine had burned its las over a year ago, then was jettisoned to spare mass.

Why hadn’t a steward awakened before her? The computer hadn’t logged any problems. Engine function read as normal; the sleds that held the fuel had been emptied one by one and discarded, all the fuel had been burned – all as planned. So, absent other problems, the lower velocity alone hadn’t triggered an alert. Stupid.

Think. They’d begun to lag only in the last months of burn. Some ignitions had failed or underperformed. It was probably antiproton decay in the triggers. Nothing could have corrected that. Good thinking, nice fail.

Twelve years.

In angered her. The impact and the low velocity directly threatened their survival, and no alarms went off. But loss of comms, that set off alarms that was important to Roger. Who was never meant to be on board. He’s turned his back on humanity, but he still wants them to hear all about it. And to hell with us.

When her fear receded, she was calmer. If Roger still believed in anything redeemable about humankind, it was the scientific impulse. Of course it was primary to him that this ship do science, and send data. This was her job.

The Market Crash in October 1987

The Market Crash in October 1987

Can an event such as the October 1987 market crash be explained by rational considerations, or does such a rapid and significant change in market valuations prove the dominance of psychological rather than logical factors in understanding the stock market? Behaviorists would say that a one-third drop in market prices, which occurred early in October 1987, cannot be explained by rational considerations. The basic elements of the valuation equation do not, according to the behavioral view, change rapidly enough to produce such a substantial change in rationally determined market prices. It is impossible to rule out the existence of behavioral or psychological influences on stock-market pricing. Nevertheless, it may be useful to review the several logical considerations that could explain a sharp change in market valuations during the first weeks of October 1987.

As a frame of reference we should recall that common stocks are rationally priced as the present or discounted value of the future stream of dividends expected from them. For a long-term holder of stocks, this rational principle of valuation translates to a simple formula:

Rate of Return to Stockholder = Dividend Yield + Long-run Dividend Growth Rate.

In symbols we can write the basic valuation equation as r= D/P + g, where r is the rate of return, D/P is the yield (dividend divided by price), and g is the long-term growth rate. Using this equation, it is easy to show how sensitive share prices can be as a result of rational responses to small changes in interest rates and risk perceptions. This equation can also throw the “Monday meltdown” (October 19, 1987) into a more logical setting.

Market Crash among the squirrels. Photo by Elena

I believe there were very good reasons to think that investors should rationally have changed their views about the proper values of common stocks during October 1987. Specifically, a number of factors tended to increase the “r” – the rate of return required by stock investors – in the equation above. First, there had been a substantial increase in interest rates in the previous two months. Yields on long-term Treasury bonds increased from about 9 percent to almost 10 1/2 percent just before the crash. In addition, a number of events created significantly increased risk perceptions in the market. In early October, Congress threatened to impose a “merger tax” that would have made merger activity prohibitively expensive and could well have ended the merger boom. It is significant to note that the stocks that went down the most in the week preceding October 19 were the stocks of companies that were the subject of takeover attempts. The risk that merger activity might be curtailed increased risks throughout the stock market by weakening the discipline over corporate management that potential takeovers provide. Also, James Baker, then secretary of the Treasury, had threatened in October to encourage a further fall in the price of the dollar, increasing risks for all foreign investors and thereby frightening domestic investors as well.

A numerical illustration will show how sensitive share prices can be as a result of rational responses to small changes in interest rates and risk perceptions. Recalling our previous equation of rational present-value pricing of common stocks, r=D/P + g, we will consider r to be the rate of return for the market as a whole and P to be the market price index, such as the price of one of the broad stock-market averages. Suppose initially that the “riskless” rate of interest on government bonds is 9 percent and that the required additional risk premium for equity investors is 2 percent. In this case r, the appropriate rate of return for equity holders (or, equivalently, the proper discount rate for common stocks), will be 11 percent (0.09 + 0.02 = 0.11). If a typical stock’s expected growth rate, g, is 6 percent and if the dividend is $5 per share, we can solve for the appropriate price of the stock index (P), obtaining 0.11= $5/P + 0.06 P = $100.

Now assume that yields on government bonds rise from 9 to 10 1/2 percent with no increase in expected inflation (which might increase so that stock market investors now demande a premium of 2 1/2 percentage points instead of the 2 points in the previous example. The appropriate rate of return or discount rate for stocks, r, rises then from 11 percent to 13 percent (0.105 + 0.025), and the price of our stock index falls from $100 to $71.43:

0.13 = $5/P + 0.06 P = $71.43.

The price must fall to raise the dividend yield from 5 to 7 percent so as to raise the total return by the required 2 percentage points. It is clear that no irrationality is required for share prices to suffer quite dramatic declines with the sorts of changes in interest rates and risk perceptions that occurred in October 1987. Of course, even a very small decline in anticipated growth would have magnified these declines in warranted share valuations.

This is not to say that purely psychological factors were irrelevant in explaining the sharp correction of market prices. I am sure that they, too, played a role in the decline. Moreover, the swiftness of the decline was probably accelerated by new trading techniques such as “portfolio insurance,” which dictated that some institutional investors should increase their selling as share prices declined. In addition, “program training,” a technique whereby an entire basket of securities can be sold or purchased using computerized generation of orders, enables changes in the market sentiment (as well as any discrepancies between the value of any stock indices, which trade mainly in Chicago, and the value of the component stocks) to affect the prices of shares with extraordinary speed. But it would be a mistake to dismiss the significant change in the external environment, which can provide a rational explanation of the need for a significant decline in the appropriate values for common stocks.

Burton G. Malkiel. A Random Walk Down Wall Street, including a life-cycle guide to personal investing. First edition, 1973, by W.W. Norton and company, Inc

If the IRS Comes Knocking

If the IRS Comes Knocking

Odds are you’ll end up paying more in tax but there’s no reason to panic

If you get audited, odds are you’ll end up paying more taxes. Thanks to computer-aided selection of targets, about 80 percent of audits pull in extra tax. Agence audits millions of individual returns, about 3% of the total field and there is going to be more sniffing around. Today the IRS audits twice as many tax-payers as it has been accustomed to doing since the 1980s. It’s also the most probing, and upper-income professionals, self-employed people, investors claiming big losses, people with considerable income from tips are the top targets, but no groupe is immune.

Audits come in three flavors. Least intimidating is a correspondence audit, which usually involves a letter asking for documentation to back up a single ite on a return – perhaps a charitable donation. More fearsome are office audits in which you are asked to come to an IRS office for a more detailed probe that may cover a number of topics. At the top tier are field audits, which most often involve business-related returns, may cover more than one year, and are coundcted by highly trained revenue agents at a taxpayer’s home or office. Self-employed people may be selected for a field audit at their place of business since that’s where records are usually kept.

If the IRS Comes Knocking. Photo by Elena

When the IRS contacts you, it has usually found something suspicious and may propose an increase to your tax up front. Experts warn:

The IRS has the presumption of correctness. You have to show why their proposed changes are wrong.

Be wary of a wolf in sheep’s clothing. The examiner you meet is likely to be friendly, professional, and even sympathetic, but his or her goal s th extract more tax from you.

Don’t volunteer information or stray when answering questions. Taxpayers can paint themselves into a corner by failing to understand the tax implications of their answers. Being laconic but responsive reduces the danger.

Correspondence audits can often be handled on your own, but if you race an office audit, you may want to turn to an accountant for guidance. When the extra tax involved is small, it may not be economic to hire a professional.

File Smart Planning Moves

Planning ideas that make a difference, from the experts of Ernst & Young

Make your contributions to an IRA or Keogh plan early in the year. The combination of making contributions early in the year and compounding will make your money grow faster.

Contribute the maximum to your 401 (k) plan early in the year. If you wait too long, you may not be able to contribute the full amount because of limitations.

Focus on the after-tax yield when comparing the returns on different investments.

Replace personal debt with mortgage debt to the extent possible. Interest expense on mortgage loans is – subject to some limitations – deductible; personal or consumer interest is not.

If you roll over a pension distribution to an IRA account, be sure you do it in a timely fashion. You must complete the transfer within 60 days of a payout

The Muses of Shuyedan-18

The Muses of Shuyedan-18

By Indrapramit Das (excerpt)

Teysanzi means new life, or beyond-life. Not quite afterlife, because of the connotations with death. I was thirty when I arrived at the Protectorate, and forty-two when I met Mi, new like I was but younger and still nan tizan, “blue-eyed” with memories of Earth. But she was quicker than me to adjust, more confident.

Nothing would get her down. Not even the sunless tiles skies and tunnels of Teysanzi, sub-city, metrocolony, Earth-Protectorate. I took her to the food court district, with its cheap neon and sunlaps battered with imported moths, its greenhouse stalls warm and rich with the smell of plants and vegetables and flowers snarling their way along the tables. She had taken it all in with a smile. The hot lights reflecting on her nose, which looked so lie a button mushroom (I would tell her so weeks later, much to her false chagrin.) I helped her with the chopsticks, her muscles still loose and hands shaking from jumping through spacetime while waking in and out of cryo-phase. From that moment watching her suck noodles into her mouth I knew I couldn’t resist the inexorable tug of affection I had avoided so long. I knew from the way she stared at me, blissful in trust, that she saw me, strong and grown into the scrubbed air and strange gravity of a new world, as somehow powerful. I fed on her awe in vampiric resignation. Quietly let her recite what she’d learned of this world back on Earth, as if to imprint her new reality with those predefined definitions, watched her explain to herself how Teysanzi cuisine was so spicy because the sub-city’s processed atmosphere and low-g made for chronic swollen sinuses and dulled taste. She licked tha same spice off her lips and left it on scrunched napkins by her tray. Mi talked in Colbyat often, to practice, though I think she was actually better at the formal language than I was. Still, I taught her Colbyat slang and swear words she didn’t know, as one will do, told her how it and other star-tongues gestated in the confined cultures of starships, q-tunneling waystations, eventually exports.

A week after her arrival, we took the buggy out to the hinterlands to start her apprenticeship. Starlight in the puddled loam sinking under our boots, she asked me, “Do you agree with the sanctions against non-het couples here?” The formality of her constant questions, as if she were continually interviewing me, still delighted me at the time.

The Muses of Shuyedan-18. Photo by Elena

“No,” I’d said. “Why?”

“Well. What if our Krasnikov collapses and we’re cut off from the rest of the protectorate net, from Earth. That’s what the Teysanzi’s afraid of, right?”

I laughed. “Teysanzi’s population isn’t even three thousand. I think if the Krasnikov collapses and we’re stuck out here a hundred light years from the nearest tunnel gate or settled planet, being het and having babies isn’t going to save our asses. Being resourceful will. Or more realistically, nothing will.”

“Yeah?” her voice loud against her helmet mic. A smile behind glass, and butterflies in my stomach. “And how’re we going to be resourceful? Build a megageneration ship to haul our descendants to the next gas station? Or should I say gas giant,” Mi asked, touching my arm lightly with her gloved hand. Her giddy infection made me light-headed. There was a tremendous energy to her out here, much more than in the sub-city. So confident, for someone on their first trip out to the hinterlands, suited up. Maybe it was adrenalin.

Bannerless

Bannerless

By Carrie Vaughn (excerpt)

Enid requisitioned a solar car from the local committee and was able to take to the Coast Road the next day. The bureaucratic machinery was in motion on all the rest of it. Committeeman Trevor revealed that a couple of the young men from Apricot Hill had preemptively put in household transfer requests. Too little, too late. She’d done her job; it was all in committee hands now.

Bert drove, and Enid sat in the back with Aren, who was bundled in a wool cloak and kept her hands around her belly. They opened windows to the spring sunshine, and the car bumped and swayed over the gravel road. Walking would have been more pleasant, but Aren needed the car. The tension in her shoulders had finally gone away. She looked up, around, and if she didn’t smile, she also didn’t frown. She talked, now, in a voice clear and free of tears.

“I came into the household when I was sixteen, to work prep in the canning house and to help with the garden and grounds and such. They needed the help, and I needed to get started on my life, you know? Frain – he expected more out of me. He expected me to be his.”

She spoke as if being interrogated. Enid hadn’t asked for her story, but listened carefully to the confession. It spilled out like a flood, lie the young woman had been waiting.

“How far did it go, Aren?” Enid asked carefully. In the driver’s seat, Bert frowned, like maybe he wanted to go back and have a word with the man.

“He never did more than hit me.”

So straightforward. Enid made a note. The car rocked on for a ways.

Bannerless Gothic Ball. Photo by Elena

“What will happen to her, without a banner?” Aren asked, glancing at her belly. She’d evidently decided the baby was a girl. She probably had a name picked out. Her baby, her savior.

“There are households who need babies to raise who’ll be happy to take her.”

“Her, but not me?”

“It’s complicated situation,” Enid said. She didn’t want to make Aren any promises until they could line up exactly whicj households they’d be going to.

Aren was smart. Scared, but smart. She must have thought things through, once she realized she wasn’t going to die. “Will it go better, if I agree to give her up? The baby, I mean.”

Enid said, “It would depend on how you define “better.”

“Better for the baby.”

“There’s a stigma on bannerless babies. Worse some places than others. And somehow people know, however you try to hide it. People will always know what you did and hold it against you. But the baby can get a fresh start on her own.”