Disqus - Latest Comments for yetanothermoderatevoice

Re: “V” for Villification: Liberal Paradise, Obama Nightmare (Guest Voice)

yetanothermoderatevoice — Fri, 06 Nov 2009 07:53:40 -0000

I have to say, I was way disappointed. When I saw the new Battlestar Galactica remake I was spellbound, whereas this remake just seemed lame in comparison with the original ... Seems to me if you're going to call something "reimagined" you have to, well, reimagine. Like Devo's cover of "Satisfaction".

The universal health care reference did seem pretty ham-handed, especially given that just about every other OECD besides the U.S. has it - so what would be their motivation for cooperating with the V's? BSG's messages were equally overtly political, but they didn't lend themselves to such easy answers.

Re: A Great Article On The Fourth Catalyst Of The Financial Crisis

yetanothermoderatevoice — Mon, 19 Oct 2009 20:22:29 -0000

"The third catalyst — and one that is nearly universally ignored — is global trade policy that enabled the United States to run massive trade deficits and assume the policies we did."

I'm pretty sure all sorts of economists talked about that for years, Martin Wolf wrote a book about it, Menzie Chinn wrote some high profile articles about circa 2006, Brad Setser seemed to talk of nothing else etc. Brad deLong even said that it was the crisis that everybody expected, rather than the one we actually got.

No?

Re: Book Review: True Enough: Learning to Live in a Post-Fact Society

yetanothermoderatevoice — Sun, 26 Apr 2009 11:47:37 -0000

I know you've been concerned about this for years, and it is a little dismaying to see. I had hoped that technique innovations (e.g. Jon Stewarts juxtaposing of "then" and "now" statements from people to point inconsistences) and disintermediation (e.g. why read the NYT summary of what the CBO director thinks of future entitlement costs? Go to the CBO director's blog and read the primary source) would mitigate, but it doesn't seem so ...

Re: Market Recovering. Economy Not. A Problem?.

yetanothermoderatevoice — Fri, 03 Apr 2009 09:45:40 -0000

AustinRoth: yes, it's true that the market tends to be a leading indicator. What I can't fathom is why, in this case. E.g.
1. Do we know anything more about the solvency of banks than we did a couple of weeks ago? (especially given that FASB just loosened the accounting rules)
2. The exposure of Western Europe to the equivalent of sub-prime sovereign debt in Eastern Europe is staggering.
3. Chinese exports dropped something like 25%.
4. There is a year hangover in housing inventory.

One intriguing idea is that implicit stimulus of the contraction in oil prices - James Hamilton has a post up today on that. So things may be just grim, not apocalyptic.

Re: Clinton Adminstration and Republican Congress, unindicted co-conspirators

yetanothermoderatevoice — Sun, 15 Mar 2009 11:26:29 -0000

I thought we already had a much richer discussion of this with (maybe by Mikkel Fishman) with links to the Fed's Kroszner, Barry Ritholtz, Martin Wolf, etc etc.

Re: In Sacramento, The Homeless Shelters Are Full; Tent City "Houses" 1200 People

yetanothermoderatevoice — Tue, 10 Mar 2009 07:05:42 -0000

With respect to the addendum, there is a catch name for the idea ...

http://en.wikipedia.org/wiki/Flexicurity

Re: Ack, My Head Hurts. What Is Happening?

yetanothermoderatevoice — Mon, 09 Mar 2009 07:26:40 -0000

It sure would be nice to see monetary policy along with fiscal policy in Bartlett's article.

Re: It's the Democratic Congress, Stupid!

yetanothermoderatevoice — Wed, 04 Mar 2009 13:16:39 -0000

Tony: "The sad thing about all of this drama is that it doesn’t mean anything that positively impacts the life of one single American citizen."

I'm not so sure this is true. Rush is advocating a particular point of view that apparently plays well at CPAC. His right to do so is in the Constitution, so I think this sort of discussion of ideas was envisaged as an important of the working of the country from the get-go. Over time vigorous discussion tends to lead to better outcomes. (See, for example, "One Economics, Many Recipes" by Dani Rodrik) That will affect the lives of citizens.

"the fact that Obama and the Democrats have no clue on how to fix the economy "

Actually this is not a fact, this requires an assessment of what Democrats know, and whether or not that is sufficient to fix the economy. If we take policies at their word, then I think you can find substantial support for their views among a substantial number of economists, and disagreement among others. People have been studying economics for a long time, and it is not as if they have *no clue*. A good summary is here: http://www.econbrowser.com/archives/2009/02/why...

And a rather pessimistic assumption on the state of economic science to address this problem here:
http://economistsview.typepad.com/economistsvie...

CStanley: "So, are you actually afraid the policies will fail and Limbaugh will be proven right?"

If only it were so simple. Obama is trying a massive policy intervention where there are a myriad of variables that might affect the outcome, and moreover, we don't get to observe what happens if we *don't* do anything. Let's say two years from now unemployment is at 6% - can we say one way or another if Obama's plan worked?

Re: Obama Enabler of the Irresponsible (Guest Voice)

yetanothermoderatevoice — Sun, 01 Mar 2009 08:54:41 -0000

The problem is right here:

"It’s a fact: people respond to incentives and disincentives. We work because we get paid, or don’t speed because we fear a ticket. People will act either responsibly or irresponsibly depending on the consequences. Obama’s bailout plans remove negative consequences to bad decisions."

1. It is, to a certain degree, self-referential that people respond to incentives. The problem is that we don't have very good models of what incentives people are perceiving or how they respond to them. Even John Cochrane doesn't know what's happening here - he refers to investors "pathologically" sitting on cash right now. (http://faculty.chicagobooth.edu/john.cochrane/r...)
2. It is a *value judgment*, not a scientific pronouncement, to say that people act responsibly or irresponsibly depending on the consequences, because you have to define what constitutes responsible. For example, portfolio managers who operate ERISA pension plans are *required* to invest for the sole benefit of plan participants. While avoiding investment in, for example "sin" stocks like tobacco or alcohol might appear to be "responsible" from one perspective, it is "irresponsible" from another.
3. Actions that appear individually responsible may be irresponsible in the aggregate. It might be responsible for each fisherman to catch as many fish as possible to best feed their family, but if everyone does this, fish stocks may be irreparably damaged so that everyone starves.

Re: We Are All "Schulbs" In This Financial Mess

yetanothermoderatevoice — Wed, 25 Feb 2009 09:37:08 -0000

T-Steel, CStanley, Mikkel:

More links ...

http://traigerlaw.com/publications/the_communit...
http://www.econbrowser.com/archives/2007/09/com...
http://www.econbrowser.com/archives/2008/07/did...

From what I've read, CRA loans, as a group, were:
1. a small portion of subprime loans
2. disproportionately kept on the books of the loan originator
3. had lower default rates than comparable high interest rate loans

So in this age of automatic search and replace, it seems easier to just replace CRA loans with privately originated speculative middle to upper income mortgages (unwieldy phrase I know) and then the arguments make equally good sense and actually fit the data.

As to why CRA loans might have lower default rates, suppose that redlined neighborhoods were economically disadvantaged ceteris paribus compared to a comparable non-redlined neighborhood, e.g.

Non-redlined: 80% of homeowners qualify
Redlined: 50% of homeowners qualify

This means that 0% of the 50% get loans. Suppose that the top 20% of the 50% are actually pretty good quality borrowers. Then a lender who is willing to apply differential standards and pricing could actually cherry pick the *best* of the redlined borrowers, *and* charge a higher interest rate.

Finally, there is something a little strange about Mikkel's comment

"So if the question is "Did the CRA lead the the development of subprime products?" I would say "yes." If the question is "Did the CRA lead to the development of the subprime problem?" those people I cited argued no."

I'm not sure I can ascribe a precise meaning to "lead to" here. Did the US Postal Service "lead to" the development of FedEx and UPS?

Re: The Coming Collapse Of 2009 ?

yetanothermoderatevoice — Mon, 16 Feb 2009 07:30:10 -0000

I recommend the highly regarding "Calculated Risk" blog (http://www.calculatedriskblog.com), although if you think you feel bad now, having explicit data on why you ought to feel bad thrown at you may make you feel worse!

Re: One Data Point To Rule Them All

yetanothermoderatevoice — Sat, 14 Feb 2009 15:00:51 -0000

mikkel: all true - my point was very narrowly constrained to PWT's argument that the government should not intervene to moderate business cycles. A combination of "modern" interest rating targeting monetary policy plus constant tax rates over a business cycle seems to have moderated the business cycle somewhat. The longer structural factors and regulatory distortions you mention are another matter entirely.

Here is a great historical chart of debt levels from the FT by the way:
http://www.ft.com/cms/s/0/b048d69c-ec90-11dd-a5...

Re: One Data Point To Rule Them All

yetanothermoderatevoice — Sat, 14 Feb 2009 10:33:34 -0000

Mikkel: nice article. you might enjoy similar comments from Vox today:
http://www.voxeu.org/index.php?q=node/3065

PWT: while it is true that a new, appropriate equilibrium in line with market fundamentals could be reached, the dynamics of the adjustment process are of concern, and that's in the happy case where are there aren't multiple equilibria, some of which are not so nice. For example if the process of market adjustment involves temporary 20 percent unemployment (i.e. an overcorrection) on its way back to 5 percent, this is not a trivial matter.

"I believe that it is intended to prevent the natural business cycle. The shallow recessions that we've had recently, especially 2001, are prime examples of why the government should not intervene against market forces. The mechanisms that allowed for the shallowness of the previous recession, have compounded the pain of this current recession."

The problem with this reasoning is that debt has increased by about $5Tr over the past 8 years, and the government continued to run deficits, on average over the business cycle well in excess of the ameliorating effects of productivity growth. In contrast, tax rates under the Clinton administration were set so that the automatic stabilizer effect was working (i.e. the budget moved steadily into surplus, and the debt continued to drop as the late 90's boom progressed). This suggests that competent execution of fiscal policy under the usual conservative rule of being balanced over the business cycle can work, whereas structural deficits do not.

Re: Card Check. What's it all about, Alfie?

yetanothermoderatevoice — Thu, 20 Nov 2008 10:20:42 -0000

Mark Perry's analysis of labor costs has been disputed, accurately, I believe - see Felix Salmon's explanation:

http://www.portfolio.com/views/blogs/market-mov...

Re: Obama Versus McCain: What Is a Moderate To Do ?

yetanothermoderatevoice — Mon, 20 Oct 2008 09:14:32 -0000

These are indeed strange times, and rather than help you, all I can offer is more confusion. McCain's health care plan owes its key ideas to Obama's advisor, Jason Furman (http://gregmankiw.blogspot.com/2008/09/post-par...). Moreover, Obama says that his health care plan explicitly acknowledges the pragmatic view that the employer system works for the people who already have it, so he doesn't want to change it.

In other words, the conservative is advocating a radical change based on the ideas of the liberal's policy advisor. The liberal, meanwhile, is advocating a conservative, incremental approach. It's no wonder you're confused.

Re: Troopergate: Small Person, Small Beer

yetanothermoderatevoice — Sat, 11 Oct 2008 08:09:21 -0000

"If there is anything refreshing about this sordid affair it is that the 12 sitting members of Alaska’s Legislative Council voted unanimously to release the 263-page investigative report, and eight of the members are Republicans."

I'm not sure this is refreshing. My understanding, from reading the occasional snippet of the Alaska newspapers that pop up on memeorandum, is that Ms. Palin was at odds with the Republican Party establishment in Alaska. So I don't count their votes, by themselves, as evidence of disinterested pursuit of ethical government, nor evidence of her guilt. Perhaps it is just petty payback.

Re: McCain and the Meltdown

yetanothermoderatevoice — Thu, 18 Sep 2008 08:22:23 -0000

This might either illuminate or muddy the water ...

http://www.ft.com/cms/s/0/8780c35e-7e91-11dd-b1...

Re: It’s not its, is it? Oh, it is.

yetanothermoderatevoice — Fri, 20 Jun 2008 10:22:47 -0000

English_teacher, Jazz: what is your source for the rule? I seem to recall that, for example, the will/shall rule originated in some twentieth century grammar book, even though it had been used interchangeably for two centuries before that. Ditto for the use of he as a third person singular pronoun for a person of unspecified gender.

Re: Recession, Heck. It’s A Regression

yetanothermoderatevoice — Tue, 10 Jun 2008 06:59:10 -0000

Nicely put Michael, although many of the long term structural factors you mention have been around for a long time, and yet the U.S. continued to grow vibrantly, so I'm not sure if the chickens are now coming home to roost.

leff: The link you mention would be better if it compared how the economy has *actually* done under Democrat versus Republican administrations. The answer may surprise you (it surprised me).

http://angrybear.blogspot.com/2007/06/comparing...

superdestroyer: "Of course, on a so-called moderate blog, I see no mention of the effects of immigration, differing birthrates, the expansion of the nanny state as possible causes. "

I think they *are* worth mentioning, but IIRC the answers are murky. For example, Canada and Singapore routinely trounce the U.S. in education scores for high schoolers, but have (near) universal healthcare, so it is difficult to sort out the effect of education policies, immigration policies, nanny statism, etc.

Re: Federal Reserve: Getting To The Core Of Things

yetanothermoderatevoice — Mon, 28 Apr 2008 12:19:46 -0000

mikkel: "the entire basis for excluding food and energy relies on the volatility being zero mean"

I assume you mean that the mean of food - core or energy - core is zero mean - i.e. you can consider headline inflation = core inflation + error term, where the error term is zero mean.

The econ blogs I read (e.g. EconBrowser, EconomistsView, VoxEU, Brad deLong) have discussed this, and there have been opinions expressed by all sorts of big names about the change in dynamics of food prices and energy, and they have expressed similar concerns. My sense is that "everybody" is seriously wondering about whether or not there has been a sea change in the role of energy and food, and whether or not core CPI ought to be replaced with headline, but there is not definite consensus that it should.

I also agree that some statistics out there are pretty misleading. While there has been reasonable GDP over the last year, what also seems to be true is that median real wages have stagnated for about eight years, while at the same time the uncertainty surrounding future income, future retirement security, and future health insurance, has dramatically increased. So the median person, looking forward, cannot feel too good about things.

Re: Federal Reserve: Getting To The Core Of Things

yetanothermoderatevoice — Mon, 28 Apr 2008 06:56:33 -0000

What you say may be true, although an alternative explanation might be that:

1. The Fed has a dual mandate to promoting full employment and price stability (http://www.federalreserve.gov/newsevents/speech...)
2. The Fed's actions can be seen in terms of a control system to stabilize the economy (http://en.wikipedia.org/wiki/Control_theory)
3. Using the terminology in that article, the "reference sensor" must measure something in order to "close the loop".
4. Even in a purely deterministic context with no lags or uncertainty about the effects of policy, the choice of an inflation measure that captures overall inflation is not obvious (http://en.wikipedia.org/wiki/Laspeyres_index).
5. Monetary policy operates in a stochastic context with long and variable lags
6. Historically, food and energy prices have been much more volatile than most other prices, but not appreciably different in long trend.

Therefore a system whose intent is to reduce painful swings in unemployment and inflation could, in principle, have better outcomes by using core rather than headline inflation.

I'm no specialist, but this narrative makes some sense to me since there are lots of things that have to be managed (e.g. relationships) where you may to decide to ignore fluctuations of some indicators (e.g. mood swings) and focus on more persistent trends. It's not a matter of manipulating statistics to show what you want (as runasim says), it's a matter of *choosing* informative statistics to help guide you.

Re: Clinton Obama Campaign: Negative Campaign Or Political Reality?

yetanothermoderatevoice — Sun, 09 Mar 2008 10:21:20 -0000

"in fact, there is a growing belief that he has at times not put enough specifics into his campaign."

Among the punditocracy, or some wider group of people, I wonder.

Seems to me Obama has plenty of specifics at his web site, or at least not substantially or substantively less than either McCain or Clinton - so I think the "lack of specifics" is just an echo chamber meme.

I think Jon Stewart nailed the dynamic some months ago ...

http://www.crooksandliars.com/2007/06/14/the-da...

Re: Book Review: ‘Joe Sixpack’s Philly Beer Guide’ & Why American Beer Is So Lousy

yetanothermoderatevoice — Fri, 29 Feb 2008 10:05:52 -0000

I moved to this area (actually New Castle Country, DE) from Joe's stomping grounds where I favored San Marcos based Stone Brewery's IPA. Currently I am favoring Dogfish Head's 90 Minute IPA.

Based your obviously in-depth knowledge, is there a better local brew available in bottles?

Re: Not An Aphrodisiac

yetanothermoderatevoice — Mon, 25 Feb 2008 14:04:00 -0000

Leaders do this sort of thing all the time. Here is Junichiro Koizumi rockin' out to Elvis ...

http://www.extrememortman.com/wp-content/upload...

Re: Great Comedians: Jack Benny And Mel Blanc Do The “Si” Routine

yetanothermoderatevoice — Fri, 22 Feb 2008 05:05:47 -0000

How did they both keep straight faces?