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You searched for: label/principal-agent problem

Storing Energy Bleg

…the problem. More thoughts after the jump. OK problem number one is that the hydroelectric plants are where they are not where we want electricity. This means that a national…

PERSPECTIVES

…of this recession created an inventory problem across virtually all sectors of the goods economy. We now seen to be in a position where the inventory problem has quit getting…

Good Cop/Bad Cop or Tit for Tat ?

…law moot. Via Ezra Klein. I prefer an analogy based on the other side, not the problem of the cops who want to make suspects talk but the problem of…

The TARP and the Welfare Queens

…will never materialize. 3. The reason the bail-out won’t succeed, like Iraq, is that it doesn’t address a real problem. Banks going under is not a problem. Bankers having incentives…

"Welfare Queen"

…doesn’t address a real problem. Banks going under is not a problem. Bankers having incentives to make risky decisions is a problem, and this bail-out will do nothing to stop…

Financial Arsonists ?

…all, how about Bandit, Arsonist and Theif’s banker ? Working together they can create a cash flow problem, a chapter 11 filing, a big payout and a workout so Bandit…

Toxic Sludge Inc

…should, but they know more than non-bank investors. Thus there is a market for lemons/adverse selection problem. The solution to adverse selection problems is a mandate. All mortgage based assets…