Links 6/24/08

Whale ‘duets’ with a clarinet BBC

Bizarre Properties of Glass Revealed Live Science

The myth of ‘weapons-grade’ enrichment Asia Times. Key paragraph:

Instead, the US media in particular have allowed themselves to become an unwitting accomplice of Israel’s anti-Iran propaganda machine, dutifully recycling the line that Iran is actively pursuing nuclear weapons, has amassed “weapons-grade” enriched uranium, and is thus on the verge of arriving at “the point of no return” with respect to bomb-making.

Before you disagree, read the article, which cites extensive misreporting of IAEA findings by the American press. Similarly:

….US’s National Intelligence Estimate (NIE) on Iran, released late last year, ….confirmed that Iran’s nuclear program was, and had been since 2003, peaceful.

To Avoid Student Turnover, Parents Get Help With Rent New York Times

Shortages, Prices Hit California Food Banks as Schools Recess Bloomberg

Lottery Tickets as Blood Money Real Time Economics, Wall Street Journal

Overseas Banks Are Winners in the US Credit Crisis MarketWatch

Bloodletting on Wall Street Dean Baker, Guardian. Baker proposes a transactions tax.

Antidote du jour:

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  1. Richard Kline

    Re: Dean Baker’s proposal of a transaction tax, I like it. Even better if it scales, both for volume and absolute value, so that small purchases had modest transaction taxes, and large purchases edged up toward the 1% and more he advocates. But let’s give some real consideration of _where_ the revenue goes within the government, too.

    If large volume throughput is supposed to be a broader societal benefit, let’s make sure some of that ‘benefit’ gets paid in up front. Also, with a tax in place, it can be adjusted in the future, up or down, to facilitate throughput velocity, though one shouldn’t put too much dependence in this intervention alone. A good idea overall, though.

  2. etc

    Dean Baker: ” tax of 0.25% on a stock trade or 0.02% on the purchase of credit default swap will have no measurable impact on productive financial transactions, but will likely put a serious dent in speculative activity. For this reason, it is a win-win-win proposition. It reduces speculation, it takes a big bite out of Wall Street revenue and profits and it raises a bucket of money. If anyone has any better ideas, they are keeping them to themselves.”

    It is peculiar for Baker to make this proposal at the end of an editorial that complains about upper-level management taking too much of the econic pie. That said, if you want to control the automated trading quants with average holding periods running from a day to a couple months, this would do it. Their business model depends on such a high volume of trading that a relatively low transactional tax would definitely hurt them, while not really affecting medium or long term investors.

    If Baker wants to control behavior of financial institutions though, I think it’s more important to control the on and off balance sheet leverage of “large” financial institutions (i.e., too big or inter-connected to fail) and funds, and only allow “small” financial institutions and funds to experiment with financial products and transactions that haven’t been stress tested through a credit crunch.

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