70 Words

Inflation and Godot

07/19/2012

While many are nervous the massively stimulative monetary policy engineered by the Fed will inevitably trigger inflation, those folks are waiting for Godot. Subtracting the current yield on a 10-year Treasury Inflation Protected Securities (TIPS) bond (-0.637%) from the current…

Read More

Divinely Different

07/18/2012

Why are Americans significantly more religious than Europeans? In Europe, there are state churches that receive subsidies, and thus the clergy focus on politics and perquisites and not proselytizing. In addition, state-sponsored churches face virtually no competition, all but eliminating…

Read More

Low Blow

07/17/2012

US Interest rates this low are harmful. Investors buy higher-yielding foreign securities (and speculate in commodities) and foreigners borrow in US dollars (not local currency), putting upward pressure on foreign exchange rates. To prevent this, central banks buy US Treasuries…

Read More

Banks Behaving Badly

07/16/2012

The LIBOR scandal is the result of greedy banks. But banks are no greedier today than they were decades ago. The difference is now banks are so big, and involved in so many activities (investment banking, commercial banking, insurance, underwriting…

Read More

Down with Divorce

07/13/2012

The Friday File: Decades ago women faced substantial workforce discrimination, had limited control over their fertility, and due to limited labor saving devices, housework was hard. Thus, women looked to find a working man to marry. Today both spouses work,…

Read More

Dread in Madrid

07/12/2012

A month ago Europe bailed out Spanish banks but left Spain on the hook for the full $125 billion loan. Since there was immediate concern Spain might default on the debt, and that the new debt was senior to all…

Read More

Big Taxes, No Money

07/11/2012

Tax rates on dividends will rise from 15% up to 43.4% on 1/1/13 if the Bush tax cuts aren’t extended. Due to behavioral changes, it won’t raise much in taxes. Firms will immediately use money planned for dividends for share…

Read More

I See Land!

07/10/2012

The US has a total land area 2.3 billion acres. In ’07, the major land uses were forestland at 671 million acres (30%), grassland pasture and rangeland at 614 million acres (27%), cropland at 408 million acres (18%), parks and…

Read More

GDP = C+I+G+(X-M)

07/09/2012

Q1 ’12 GDP was composed of personal consumption expenditures (C) totaling $11.0 trillion, private investment (I) of $2.0 trillion, government spending (G) of $3.0 trillion and net exports (E) of -$0.6 trillion. In Q2, G will be slightly lower, with…

Read More

Doing the Mumbo Jumbo

07/06/2012

The Friday File: Bureaucrats write regulatory orders that are generally incomprehensible because they try to obscure the fact that they’re forbidding you from doing what you want. Occasionally, a top regulator will force his/her agency to write in plain English.…

Read More

Recent Posts

Categories

Archives