From Crash of the Titans, pp. 33-34: The largest chunks of these [created by Merrill in the winter of 2006-2007] CDOs still carried triple-A ratings, at least in name, because the credit rating agencies hadn’t bothered to recalibrate their antiquated ratings models. But almost no one was willing to buy the triple-A portion of these […]
Even the normally level-headed Buce—who knows better and lets us know he knows better—tries to give Tyler Cowen’s broadside at Fannie and Freddie the benefit of some (contrived) doubt. I’ve already screamed about the legerdemain of Cowen’s post elsewhere, so let’s go for the philosophical underpinnings. Let’s give some ground first. Buce is spot-on with: […]
From his column in today’s FT: Even this is too simple, once one allows for banking: Ireland’s net debt was a mere 12% of GDP in 2007 In other words, in FT World, privatizing the profit and socializing the risk is A Great Idea that deserves the full support of the government.
Spent the morning at this event: presentations and discussion by Joe Stiglitz, Yves Smith, Mike Konczal, Joe Gagnon, Matt Yglesias, Tom Palley, and many others. Mike K. tole me he expects that video will be available this evening, at least of the speakers’s presentations. I plan to post at more length later; meanwhile, you can […]
It’s no secret I’m not a fan of the birth-death adjustment to the employment serieses: not from a necessary belief that they’re biased, but rather because they give the lie to the illusion of accurate monthly data. But imagine for the moment that there had been no adjustment before the January data release. The headline […]
Invictus at The Big Picture notes that, as recent recoveries from recessions go, the current “recovery” has the best private-sector hiring of the past three. Source: St. Louis Fed Expansion Charts via The Big Picture Go read the whole thing.
The NYT moves deeply into delusion: The rolling real estate crash that ravaged Florida and the Southwest is delivering a new wave of distress to communities once thought to be immune— economically diversified cities where the boom was relatively restrained. In the last year, home prices in Seattle had a bigger decline than in Las […]
As the late Allison Snow-Jones noted, economics depends on working mathematics. Mathematics, in turn, depend on the conditions being described correctly. If I build a model in which two things are independent, they have to be independent for my model to work. Or, to quote a quoting: Many months ago, I quoted the brilliant Janet […]
Begin with a Really Stupid Assumption: Assume Tom Friedman is correct. Not about the brilliance of cab drivers, or the flatness of the Earth, or even that AGW is the route to revitalize the U.S. economy.* But assume as valid his claim that the “global economy” makes war less likely; that Pakistan and India won’t […]
The Reserve Bank of New Zealand released a paper by Nicolas Groshenny last month—I’m behind on planning for Chanukkah; that I got to a paper from New Zealand about U.S. monetary policy this soon is, er, probably one of the reasons why—in which he evaluates the counterfactual of following the “Taylor Rule” from 2002 to […]