Attention Economy


Tuesday, December 31, 2013

Politics, Economics and History – Interesting Readings

WRONG: Nine Economic Policy Disasters and What We Can Learn from Them by Richard S. Grossman (an easy to read book that offers important lessons through the prism of economic history)
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Lawrence in Arabia: War, Deceit, Imperial Folly and the Making of the Modern Middle East by Scott Anderson (a worthwhile read for history buffs)
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 Kludgeocracy in America by STEVEN M. TELES (an article in the National Affairs)
According to Steven Teles,
With that complexity has also come incoherence. Conservatives over the last few years have increasingly worried that America is, in Friedrich Hayek's ominous terms, on the road to serfdom. But this concern ascribes vastly greater purpose and design to our approach to public policy than is truly warranted. If anything, we have arrived at a form of government with no ideological justification whatsoever.
The complexity and incoherence of our government often make it difficult for us to understand just what that government is doing, and among the practices it most frequently hides from view is the growing tendency of public policy to redistribute resources upward to the wealthy and the organized at the expense of the poorer and less organized. As we increasingly notice the consequences of that regressive redistribution, we will inevitably also come to pay greater attention to the daunting and self-defeating complexity of public policy across multiple, seemingly unrelated areas of American life, and so will need to start thinking differently about government.”
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The Entrepreneurial State: Debunking Public vs. Private Sector Myths by Mariana Mazzucato (a thought-provoking book)
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The Dictator's Handbook: Why Bad Behavior is Almost Always Good Politics by Bruce Bueno de Mesquita and Alastair Smith (a controversial book on political theory)

The BRICs - Prices, Exchange Rates and Relative Purchasing Power

An interesting post from The Economist on the relative purchasing power in BRICs and the US:


Monday, December 30, 2013

Interesting Items - 12/30

Specialization vs. Diversification 
Ricardo Hausman – The Specialization Myth

Economic Inequality Debate
Nicholas Wapshott Asks: Is the Pope a Socialist?
http://blogs.reuters.com/nicholas-wapshott/2013/12/30/the-popes-divisions/

Japan
Japan’s Nikkei Experiences Its Best Performance Since 1972

Japan’s Economic Recovery – To Early to Cheer


A Major Concern for US Higher Education:
 According to above article:
“Under pressure to turn out more students, more quickly and for less money, and to tie graduates’ skills to workforce needs, higher-education institutions and policy makers have been busy reducing the number of required credits, giving credit for life experience, and cutting some courses, while putting others online.
Now critics are raising the alarm that speeding up college and making it cheaper risks dumbing it down. “We all want to have more students graduate and graduate in a more timely manner,” says Rudy Fichtenbaum, president of the American Association of University Professors. “The question is, do you do this by lowering your standards?”“


Differential Tuition Pricing
I have never been a fan of differential pricing being applied to college tuition – it tends give an exaggerated picture of tuition inflation and creates needless complexity and administrative bloat. Thankfully, some colleges are coming to the realization that they would be better served by adopting a simpler tuition structure:

Sunday, December 29, 2013

Saturday, December 28, 2013

Financial Sector - Interesting Items

Wall Street Hiring Practices – Not Exactly Merit-Based

Academics-Industry Ties – Some Not So Positive Examples

Where is the Bond Market Headed?

Sunday, December 22, 2013

The Fed and Wall Street


Gretchen Morgenstern’s highly informative piece:

An excerpt from the article:

“With the big banks, everything is negotiated,” said Edward J. Kane, a professor of finance at Boston College and an authority on regulatory failure. “The rule provides a constraint on the negotiation, but ultimately the Fed and these banks are married. They are, day after day, dealing with each other and as in a marriage you almost never issue an ultimatum.”

Saturday, December 21, 2013

Greenspan – Back in the News

Aging Population and the Bond Market – Greenspan May Have Been Right


Bob Solow Critiques The Map and the Territory: Risk, Human Nature, and the Future of Forecasting by Alan Greenspan  

South Asia - Interesting Items

A New Great Game – Central/South Asia

Coorg – A Paradise for Coffee Lovers
An interesting FT Travel piece on Coorg

India's wine producing region gets some international recognition:
http://www.nytimes.com/2013/12/08/travel/cultivating-a-wine-region-in-india.html

Book Publishing - Still Thriving in India

Friday, December 20, 2013

High Frequency Trading and Apple’s Stock Price


A short but illuminating piece:

US GDP Data Revised Up (Yet Again)


One wonders about the data collection and statistical abilities of the staff at BEA/Department of Commerce. The advance estimate for 2013Q3 real GDP growth rate was 2.8%, and the second estimate was 3.6%. Today’s release of the third estimate suggests that 2013Q3 real GDP growth rate was in fact 4.1%. Those are some serious data revisions (the third estimate is almost 50% higher than the first estimate). BEA should consider not releasing advance estimates.

 http://www.bloomberg.com/news/2013-12-20/third-quarter-growth-in-u-s-revised-higher-on-services-spending.html

I feel sorry for professional macroeconomic forecasters who are often rewarded (year-end bonuses, etc.) based on the accuracy of their prognostication. Every major data revision probably screws up the rankings of top forecasters for the year.

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IMPORTANT: REAL GDI IS TRACKING WELL BELOW REAL GDP FOR 2013Q3; Real GDI rose only by 1.8%
http://www.bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm