A few years old but for a bit of levity on a Monday afternoon (theOnion):
Monday, October 31, 2011
A few years old but for a bit of levity on a Monday afternoon (theOnion):
Sunday, October 30, 2011
If insurance written by market participants for market participants is invalidated by sovereigns, what is the value of insurance contracts being offered by the sovereigns themselves?
Here I’m referring to the European Financial Stability Facility, which is now being touted as a super insurer of European sovereign debt (albeit maybe only the first 20%). Once again, Buiter makes a critical point: not allowing existing CDS to trigger reduces the credibility of the EFSF protection.
I’d go even further. The whole euro exercise has raised serious credibility issues. Governments used all sorts of accounting fudges, off-balance-sheet accounting and derivatives to meet single-currency membership criteria that had already been stretched to breaking point. Greece consistently misled on the state of its finances.
France and Germany broke the Maastricht treaty obligation to keep their budget deficits below 3% of GDP even before the 2008 financial crisis.
The latest maneuverings just confirm that Eurocrats make used-car salesmen look like the apotheosis of probity, prudence and honesty.Expect there to be "unanticipated consequences" like higher interest rates, and the fact market participants will generally be wary of buying an insurance product that doesn't actually insure against anything. More here on the short cuts, half measures and games European politicians and finance ministers are playing to forestall what seems increasingly inevitable - and how in doing so, may "unintentionally" be making things worse (Telegraph.co.uk).
Friday, October 28, 2011
If the very rich got that way through special access to government power, then why is the solution to tax them more, and not just to reduce government power?
And if the very rich got that way through hard work and innovation, then why the hell are we proposing to take resources out of these people’s hands?
Thursday, October 27, 2011
If the international community is really interested in contributing to country ownership of development efforts, there should be much more discussion of how to promote a more sophisticated approach to such issues. For the aid business, this would mean first taking a more active stance on non-aid issues in development and next a different concept of what development cooperation is about, implying the acquisition of new skills. But the agencies that we support as taxpayers are not going to be able to transform themselves in the suggested way if there is not a new climate of opinion in donor countries about how development happens and how, at the margin, aid may help.
NGOs and public intellectuals who over the past period have helped to create the public assumption that development and poverty reduction are fundamentally about resource transfers from rich people to poor people have a particular obligation to help build a new consensus about the fundamental role of institutions and leadership in successful development. That the most promising kind of external contribution to development which outsiders can make is skill- and knowledge-intensive engagement with the collective-action problems at the heart of countries’ political systems is a hard message to get across. We need to find ways of doing this.
Absolutely decimating a few of the myths on inequality in free markets - 9 minutes well spent. The key I think a lot of people miss is that inequality today in free markets is much different, looks and feels much different than what it's been like historically because the inequality isn't structural.
The perverse effect of pursuing equality in free markets, is that it not only makes everyone poorer, but it entrenches the elites in that society. (Coalitionofthewilling.net via Instapundit.com):
Saturday, October 15, 2011
Wednesday, October 12, 2011
Monday, October 10, 2011
… economic freedom and civil and political liberties are the root causes of why some countries achieve and sustain better economic outcomes. For instance, a one unit change in the initial level of economic freedom between two countries (on a scale of 1 to 10) is associated with an almost 1 percentage point differential in their average long-run economic growth rates. In the case of civil and political liberties, the long-term effect is also positive and significant with a differential of 0.3 percentage point…
In contrast, no evidence was found that the initial level of entitlement rights or their change over time had any significant effects on long-term per capita income, except for a negative effect in some specifications of the model. These results tend to support earlier findings that beyond core functions of government responsibility—including the protection of liberty itself—the expansion of the state to provide for various entitlements, including so-called economic, social, and cultural rights, may not make people richer in the long run and may even make them poorerMore here (theIncindiaryInsight via Instapundit on the "Occupy Wall Street" Protests):
Capitalism is the best economic engine for creating wealth and prosperity that has ever been developed. The West once was capitalist, but today it is a corporatist juggernaut in it's death throes, whereby corporations and banks control the government in their favor, inevitably leading to corruption and decline. This is not capitalism, not even in the broadest interpretation of the word. I've posted a picture in a previous post on North Korea and South Korea to make a point: a capitalist country lives in prosperity, a dictatorship does not. If capitalism is so horrible, why has America lead the way in innovation, technology, scientific output, and made Americans the wealthiest (by far) workers of any nation on earth? The poor in America live better than middle-class Europeans.
It's time to stop demonizing an entity that we have already benefited immensely from. It's damn time for Millennials to stop taking the fashionable position of saying "capitalism does not work" when they are the inheritors of a capitalist empire. The Occupiers in, at last count, 147 cities nationwide, protest a system that has been overtaken by corporations that are already in bed with the government anyway. If they have a problem with wealth, they should aim their frustrations at a government that sucked away trillions in tax-payer money for sinfully corrupt banks. Capitalism is not the enemy here, excessive government control and regulations is.
Sunday, October 09, 2011
The state of true science is the key to knowing whether something is truly rotten in the United States. But any such assessment encounters an immediate and almost insuperable challenge. Who can speak about the true health of the ever-expanding universe of human knowledge, given how complex, esoteric, and specialized the many scientific and technological fields have become? When any given field takes half a lifetime of study to master, who can compare and contrast and properly weight the rate of progress in nanotechnology and cryptography and superstring theory and 610 other disciplines? Indeed, how do we even know whether the so-called scientists are not just lawmakers and politicians in disguise, as some conservatives suspect in fields as disparate as climate change, evolutionary biology, and embryonic-stem-cell research, and as I have come to suspect in almost all fields? For now, let us acknowledge this measurement problem — I will return to it later — but not let it stop our inquiry into modernity before it has even begun.
When tracked against the admittedly lofty hopes of the 1950s and 1960s, technological progress has fallen short in many domains. Consider the most literal instance of non-acceleration: We are no longer moving faster. The centuries-long acceleration of travel speeds — from ever-faster sailing ships in the 16th through 18th centuries, to the advent of ever-faster railroads in the 19th century, and ever-faster cars and airplanes in the 20th century — reversed with the decommissioning of the Concorde in 2003, to say nothing of the nightmarish delays caused by strikingly low-tech post-9/11 airport-security systems. Today’s advocates of space jets, lunar vacations, and the manned exploration of the solar system appear to hail from another planet. A faded 1964 Popular Science cover story — “Who’ll Fly You at 2,000 m.p.h.?” — barely recalls the dreams of a bygone age.
Friday, October 07, 2011
There are, fundamentally, two subspecies of entrepreneur. One starts from the present, and visualizes the next logical step from where things are now. This type figures out how to make something better, cheaper, or more widely available, and manages to clear the financial, regulatory, and market barriers to getting it into the marketplace. The other visualizes a different world, one in which things are different and better from the way they are now, and then figures out what path of evolution brings us to that world, and, as the last step, what is the least ambitious step possible that will move things toward that goal.
Steve Jobs was one of the latter group, and one of the most successful of his time.
Thursday, October 06, 2011
Tuesday, October 04, 2011
Monday, October 03, 2011
Sunday, October 02, 2011
Sure a bit depressing but it also allows for resources to be reallocated to more productive uses (Seth Godin via Bill Conerly):
It was the inefficiency caused by geography that permitted local workers to earn a better wageRead the whole thing - I think I largely agree with Godin on how the world and more specifically the nature of work is changing.
Saturday, October 01, 2011
A reminder that markets, trade and technology work. It's tough not to be optimistic... (though the time to have reformed social security was like 20 years ago - and the longer we wait, the worse it will get for governments) - Youtube via Paul Kedrosky: