by reader coberly SOCIAL SECURITY: RETURN ON INVESTMENT We often hear claims that the “rate of return on investment” of Social Security is less than what a person could realize by investing “in the market.” So much so that some authors claim that Social Security has created a “legacy debt” that amounts to a “backward […]
by reader Noni Mausa Title: Going into Shock Subhead: Some economic metaphors seem more appropriate than “tighten your belt.” Explaining economic realities and their likely solutions can be made a lot easier with the judicial use of well-understood metaphors. Unfortunately, these tools can be also Used for Evil, or at least Confusion. In times of […]
Reality (h/t Dr. Black): In certain ZIP codes in places like Homestead and Florida City, around 25 percent of the homes are in one stage of foreclosure or another. Countless others were built by developers and sit vacant in ghostly subdivisions, with not a buyer in sight. In the days after Andrew, then-Dade County Emergency […]
This is why we don’t believe the bailout will work the way you think it will (i.e., to increase lending): Recently, securities rated AAA have changed hands for roughly 30 cents on the dollar, and most of the buyers have been hedge funds acting opportunistically on a bet that prices will rise over time. However, […]
By Spencer The updated fourth quarter real GDP revisions really did not have much interesting information. But maybe the most important data was the release of fourth quarter profits, especially for financial corporations. From the fourth quarter of 2007 to the fourth quarter of 2008 financial corporation profits fell from $370.3 billion to $122.4 billion, […]
Robert Waldmann The USSR (Union of Serious Socialist Republicans or House GOP caucus) just came out in favor of nationalizing banks. From their alternative non budget [O]ur plan supports a process to address insolvent institutions that stops throwing good money after bad into failing institutions and places insolvent ones into temporary receivership. … For insolvent […]
Robert Waldmann I just read the pdf of Geithner’s new regulatory proposal. Generally pretty mild I’d say. Geithner is firmly of the view that firms should not be able to pick their regulators. He proposes a new regulator for “systemically important firms (rough definition like Lehman and AIG) which would decide which firms (including potentially […]
rdan Run 75441 comments on the WTO and US stimulus spending (lifted from comments): Lori Wallach, Director of Public Citizens Global Trade Watch did a recent (March 12, 2009) report to the subcommittee on Terrorism, Nonproliferation, and Trade, “US Foreign Economic Policy in the Global Crisis.” Briefly this is what she is saying about banking […]
rdan Dean says: Why Is “Buy America” Okay for Banks, but Not Steel? Those damn protectionists in the Obama administration obviously don’t know anything about economics. How else can we explain the decision to require that the fund managers in their bank bailout plan must be headquartered in the United States. I can’t wait to […]
rdan Fresh Air and Terry Gross carried an interview with Frank Partnoy, a former trader and author of the 1997 book FIASCO: Blood in the Water on Wall Street, provides an interesting perspective and history.