Relevant and even prescient commentary on news, politics and the economy.

Jonathan Zasloff is being very interesting over at the Reality Based Community.

Robert Waldmann I guess I should give permalinks although they are consecutive posts. In random order, he asks who should be on the energy team. I have already expressed my view on this issue. I think the Reality Based Community should be the energy team. He asks “Where is Joe Stiglitz ?” I add what […]

Kevin Drum asks the Romers some questions

Robert Waldmann Tries to answer. Drum summarizes better than Waldmann Last year Christina and David Romer wrote a paper that attempted to quantify the effect of tax changes on economic growth. I read it at the time and didn’t understand it. I read it again a few minutes ago and I still don’t understand it. […]

Citibank Like S&P assumed house prices can’t go down

Robert Waldmann reads Eric Dash and Julie Creswell who argue that Citibank took insane risks holding CDOs on its books, because of a failure of the fixed incomes risk management team, reckless ‘short termism’ and two amazing mistakes. The two alleged mistakes are that they trusted the ratings agencies and that they assumed that the […]

USA a Center Left Nation

Robert Waldmann Matthey Yglesias points to an old report which attempts to demolish the center right nation claim. I think the report is a precious resource as it collects the relevant data. Previously I found myself wasting a lot of time searching I have some thoughts on the report after the jump. update: […]

Dynamically Inconsistent Preferences and Money Demand (repeat)

Emanuele Millemaci and Robert Waldmann This paper focuses on two main issues. First, we find that, on average, households’ discount rates decline. This implies dynamically inconsistent preferences. Second, we calculate an indicator of the degree of dynamic inconsistency that may help us to understand how households overcome their self-control problems. We use a micro data […]

Obama’s Cabinet

Robert Waldmann has some concern that, having been elected President of the USA with a brown skin and middle name Hussein, Barack Obama is looking for a real challenge. He is known to be much interested in “Team of Rivals” wants Hillary Clinton to be Secretary of State and Joe Lieberman to impartially investigate whether […]

The Credit Rating Game

by Robert Waldmann In my teens when I learned of the existence of credit rating agencies I wondered why private firms with such power weren’t corrupt. Why don’t firms pay bribes to obtain high credit ratings ? I still don’t know the answer but I think that the key is that the ratings are determined […]

Liars Bond Ratings

Robert Waldmann is reading the article everyone is reading by Michael Lewis on what went wrong. My jaw just dropped. Long long ago, I wondered how bond rating agencies could be so powerful without being corrupted. For months I have wondered how they could get ratings so wrong (and assumed it wasn’t corruption). I’d guessed […]

I’m surprised that Paul Krugman is surprised

By Robert Waldmann Paul Krugman writes Max Baucus — Max Baucus! — is leading the charge on a health care plan that, at least at first read, is more like Hillary Clinton’s than Barack Obama’s; that is, it looks like an attempt at full universality. (The word I hear, by the way, is that Obama’s […]

Shopping for Regulators

by Robert WaldmannJeff Girth asks “Was AIG Watchdog Not Up To The Job?” Short answer — no.Slightly longer answer — that depends, do you think their job was to regulate or to make sure that no one else regulated ? They seemed to think it was the second and managed. In 1999, Congress passed legislation […]