Archive for October 2011
A Hail Mary for Sprint
Because Sprint now sells iphones (as of 10/1/11), its bottom line will take a hit. The extra subsidy cost of selling an iphone to an existing Sprint customer (rather than a Droid phone) is $100. Based on data from Verizon and AT&T it takes about a 12 months for any earnings benefit to show up.…
Read MorePayroll and Playoffs, Unrelated?
The Friday File: Baseball’s 3 teams with the highest payrolls are watching the playoffs on TV. The Yankees ($202.6 million) were upset by the Detroit Tigers ($105.7 million), while the Philadelphia Phillies ($172.9 million) were upset by the St Louis Cardinals ($105.4 million). The Boston Red Sox ($161.7 million) actually missed the playoffs after a…
Read MoreWhat’s my Share?
Firms frequently buyback their own shares when they think they are undervalued. Problem is, firms often get it wrong! So far this year HP has spent $7.6 billion to buy 200 million shares at about $38/share. In ’10 HP spent $11.3 billion to buy 250 million shares at about $44/share. HP shares currently trade at…
Read MoreNobel Prize Winners in Economics
The Nobel Prize in economics was awarded to Tom Sargent at NYU and Chris Sims at Princeton. Sargent’s work has helped us understand the impact of permanent changes in economic policy. Sim’s research has helped us measure the effect of temporary changes, or shocks, on the economy. Sims said he was going to keep his…
Read MoreMegaprofitable Texting
Last year about 2 trillion text messages were sent in the US generating more that $20 billion in revenue for cell phone companies. Experts estimate that it costs cell phone companies about a third of a cent to send a text message yet they charge us 10 to 20 cents for that same text. That…
Read MoreCricket Cost-Benefit
The Friday File: Despite the added risk of becoming bird food, male crickets gallantly give their mates priority in crawling into safe burrows. In a recent issue of Current Biology, researchers found paired males were 3.9 times more likely to be eaten than unpaired males; mated females were 5.6 times less likely of being snack…
Read MoreRegulation Bites
Pinellas County FL has announced it will stop putting fluoride in its water. A Commissioner called it “a social sort of program” to be avoided. This is nuts. Adding fluoride is one of the great public health achievements of the 20th century and has reduced tooth decay. At best, critics content it causes fluorosis. The…
Read MoreNobel Prize Prognostications
With the Nobel in economics to be awarded next week, here’s my list of candidates: Bhagwati and Dixit for research in international trade, Barro and Romer for growth econ, Hart for transactional econ, Nordhaus and Weitzman for environmental econ, Fama and French for financial econ, Shiller and Thaler for behavioral econ, Diamond for financial intermediation,…
Read MoreEnergy Sprawl
While energy sources like the sun and wind are free, converting them into large quantities of electricity requires lots of lands. The math is easy. To get 1,000 megawatts of solar capacity in the Mojave desert your need 15 sq miles, an area almost as big as Manhattan. Wind energy requires more land! 1,000 megawatts…
Read MoreMeasuring Teacher Quality, Badly!
Public school teacher effectiveness and thus salary, promotion, assignment and tenure decisions are based on certification, advanced degrees, and years of experience. Regrettable there is almost no relationship between those variables and teacher classroom performance with the slight exception of years of experience and that plateaus after just 3 or 4 years. Moreover, research has…
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