The always-thought-provoking Steve Randy Waldman, inspired by that Paul McCulley piece I cited last week on “the paradox of deleveraging,” writes:
Encouraging people to go shopping in order to help the economy is not “second best” policy. It’s a desperate last resort. We’re not at a point where there’s so little economic activity that we
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As recently as last fall, the mantra in the Bush administration was that the federal deficit, at 1.2% of GDP in FY 2007 and 1.9% in FY 2006, was smaller than the average of the previous 40 years. It was a true statement, although the choice of 40 years was interesting. If you’d gone with 60 years, or just the post World War II era, only …
Given the current slump in oil prices it’s a bit ill-timed, but the people at Clingendael, the Dutch equivalent of the Council on Foreign Relations, have a new report out arguing that:
Until recently, the oil price was largely underpinned by the marginal cost of the last barrel needed to match demand, with some political and economic
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From the WSJ:
National restaurant chains Bennigan’s and Steak & Ale have closed their doors and filed for Chapter 7 bankruptcy protection, shuttering more than 300 locations and letting go of thousands of employees.
It is one of the country’s largest restaurant bankruptcies and eliminates two sit-down chains that have been part of the
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A reader writes, in response to my column of a couple weeks back about the pre-Fannie-Freddie-bailout housing bill:
All this mumbo jumbo coming out of D.C. and the financial community is so much smoke screen. Don’t fall for it. Question EVERY single thing they say. Force them back to the basics.
For example, you reported that the
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The Housing and Economic Recovery Act of 2008 is headed for President Bush’s desk. He’s planning to sign it. Will it stop the housing crash in its tracks and avert recession? Probably not. Will it keep things from getting worse than they otherwise would? Probably. Is it full of lots of junk that won’t do much good at all? Almost …
It’s Bill Gross’s rambling pleas for action from Washington that get most of the attention. But I think PIMCO strategist and portfolio manager Paul McCulley is actually much better than his boss at laying out the case for government intervention. This is from his July commentary, which I just stumbled across:
[T]he paradox of thrift
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But that’s not gonna stop me from posting it. From Brad DeLong:
Here’s what NetNewsWire throws up as tops in attention in the “economics” category:
* Mark Thoma’s Economist’s View http://economistsview.typepad.com/economistsview/
* Alex Tabarrok and Tyler Cowen’s Marginal Revolution
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From the abstract of “An Economic Model of the Planning Fallacy,” (pdf!) by Markus Brunnermeier, Filippos Papakonstantinou, and Jonathan Parker:
People tend to underestimate the work involved in completing tasks and consequently finish tasks later than expected or do an inordinate amount of work right before projects are due. We
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In response to my post over on the Creative Capitalism blog about
the vexing dilemma that:
1) Having multiple organizational goals can be a recipe for underperformance and waste,
but
2) Focusing exclusively on a single, simple goal like profit maximization or shareholder value can lead an organization terribly astray.
Two telling news reports today about retailers from metropolitan Seattle. First:
NEW YORK (Reuters) – Costco Wholesale Corp warned on Wednesday that its quarterly profit would miss current Wall Street targets because of soaring energy costs and other inflationary pressures, sending shares of the No. 1 U.S. warehouse club operator down as
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John Paulson, the hedge fund guy who made the spectacularly dead-on bet that the market for mortgage securities would go haywire last year (and took home a paycheck in the vicinity of $3.7 billion in the process), is planning a new fund that would invest in financial companies.
The fund would “provide capital to financial firms hurt by …
