Robert Waldmann William Saletan covers new bold, to him alarmingly extreme, frontiers of public policy. Here he shows he hasn’t quite figured out Smith’s insights on public finance and that he considers “On Liberty” by John Stuart Mill to flirt dangerously with paternalism. Saletan is unique (thank God). New York City’s health commissioner, Thomas Frieden, […]

Robert Waldmann This is getting alarming. Two very smart bloggers — Matthew Yglesias and Ezra Klein argue (using the term broadly) against soaking the rich. The bizarre thing is that they don’t present an argument that it would be bad policy and they certainly don’t present the argument that it is politically impossible. My good […]

IN a comment to a post a while ago, someone asked me to explain the phrase “money metric welfare” and why I hate it so much. It is, in fact, the element of economic theory which I like least, at that is saying something. A good explanation is given by a non Socratic dialogue reposted […]

Robert Waldmann One of Keynes’ concepts which never made any sense to me was the idea that there is speculative demand for money. As far as I could tell, it was a very fance name for the liquidity trap — if the safe short term interest rate is zero, money is a close substitute for […]

Robert Waldmann An amazing figure (just click the link) via Don The Libertarian Democratvia Felix Salmon all fascinated by Goldman Sachs. If a bank repackages mortgages and doesn’t sell the securities it *still* can reduce required capital. Wow. Goldman Sachs has been criticized a lot recently, but they do seem to have strong support among […]

Robert Waldmann is trying to write coherent English I might be able to explain the topic of the paper on which I want comments. Here’s my current effort. People often claim to have trouble controlling their spending. Thus as they plan future spending and saving, they would like to restrain their future selves. This can […]

Robert Waldmann I consider plain old mortgage bonds (MBS) the last clearly socially useful innovative financial product. Here I will argue contra MBS basically in an attempt to understand Krugman’s not so recent root and branch denunciation of securitization. First the case for the original MBS (which I actually believe). Securitized claims on the cash […]

Robert Waldmann is still trying to think of creative was to use CDS to commit fraud. One key use of CDS was to relax capital controls. A debt instrument plus a CDS from AAA rated AIG counted as AAA debt, thus banks could gamble more if they bought a CDS from AIG. Would this still […]

Robert Waldmann JimLuke argues that GM will almost certainly go bankrupt because … there may be thousands (perhaps even millions) of seperate bondholders, the vast majority have no voice in the negotiations. Instead, there is a “bondholders’ committee”. Who is on the committee? The “experts” and the large bondholders: primarily banks and bond funds. These […]

Robert Waldmann Due to a snarky suggestion from sammy, I actually read this pdf fact sheet from the Treasury about the Geithner plan (thanks again sammy). It was much less bad than I thought. Although he doesn’t like to disagree with Krugman, Maynard at Creative Destruction makes this argument (much more briefly and clearly than […]