Asking good questions is half the battle in advancing knowledge, and a clever and timely piece by Andreas Georgiadis and Alan Manning of the London School of Economics does just that. The post looks into why rising income inequality isn’t strongly correlated in democracies with more concerted efforts at redistribution. After all, as wealth becomes […]
Read more...It seems the more we learn about greenhouse gas emissions and climate change, the more we discover that warming processes are self-reinforcing. Melting of Arctic ice means that white polar surfaces, which reflected heat back into the atmosphere, are replaced with open ocean, which absorbs heat well and accelerates warming. As atmospheric CO2 levels rise, […]
Read more...Merrill Lynch is under investigation in Massachusetts for having sold some CDOs that fell 91% in value in less than a year to Springfield, a municipality that was just getting out from under its own fiscal woes. The amount at issue isn’t large by Wall Street standards; the CDOs in question fell by $13 million. […]
Read more...Economic indicators take a turn for the worse James Hamilton, Econbrowser In Chinese Factories, Lost Fingers and Low Pay New York Times Fair Tax? Huckabee’s win in Iowa requires more discussion of his tax proposals ataxingmatter. Huckabee’s “fair tax” is downright wacky. A disturbance in the Force Accrued Interest. We’ve commented on the stock-bond market […]
Read more...Science Daily tells us that a new Princeton University Press book, What Bugged the Dinosaurs? Insects, Disease and Death in the Cretaceous, by George and Roberta Poinar argues that insect borne diseases played a major role in the demise of dinosaurs. Their reasoning? The reptiles died off over too long a period for a cataclysmic […]
Read more...Credit default swaps are insurance against defaults, and can be written on specific entities or on indices. Higher CDS prices mean the protection sellers require higher payments to assume the default risk. CDS prices increased sharply this week for the logical suspects, namely, commercial banks with substantial real estate exposure and homebuilders. From Bloomberg: The […]
Read more...A refreshing article in the Financial Times by Samuel Brittan reminds us that some celebrated economists envisioned continuing progress as leading not to ever-escalating levels of consumption, but to a society where improving productivity and technology would provide higher quality goods and more leisure. The French hew to that ideal (as Paul Krugman has pointed […]
Read more...In case you had any doubts about the efficacy of US medical spending… From UCSC, via Barry Ritholtz.
Read more...Plop Plop, Fizz Fizz, Economic Relief It Is? Boom2Bust. How our economy, as recently as December deemed to be sound, now may get a dose of fiscal stimulus. Tilting At Windmills Bank Lawyer’s Blog. An 11 year foreclosure. USA Retail’s Perfect Storm Cassandra Does Tokyo Financial Globalization and the US Current Account Deficit Menzie Chinn, […]
Read more...William Cohan, the author of the popular and award-winning book The Last Tycoons: The Secret History of Lazard Frères & Co gives a badly flawed account the past in his comment, “Mixed portents for Wall Street’s rescuers,” in today’s Financial Times, and therefore makes a misleading comparison. Cohen goes through the recent foreign investments in […]
Read more...Bear with me on this post; it makes a more important point than you might anticipate. Reader Jim J sent this item from the Daily News, which tells of the indignities suffered by Citibank customers in New York City (including Jim himself) of having their ATM withdrawal limits reduced by half with no advance warning. […]
Read more...Although a robin does not make a spring, the increase in ABCP outstandings is the first sign of improvement in the market for asset backed paper in quite some time. The required spread over 30-day Libor also improved dramatically. From Bloomberg: For the first time since the August freeze in the credit markets, companies issued […]
Read more...For those who may be too young to have been around in his heyday, Henry Kaufman, aka Dr. Doom, was one of the preeminent economists during the early to mid 1980s, when his firm, Salomon Brothers, ruled the bond markets. Kaufman had a particularly well honed ability to read interest rate trends, no mean skill […]
Read more...John Plender of the Financial Times warns us that the movement of assets from shaky players to the solvent has only just begun. Those who complain of crown jewels begin sold to foreigners had better get used to more of the same. Plender points out that investors are taking real risks, not merely that their […]
Read more...John Hockenberry, former Dateline correspondent, describes in the MIT Technology Review how the networks’ preoccupation with hanging on to their viewers has gotten in the way of reporting news. News programs, at least as exemplified by NBC, where Hockenberry once worked, go to considerable lengths to find affirming emotional narratives and avoid upsetting or challenging […]
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