Saturday, November 10, 2007

Cállate la boca!!

Here is a verbatim translated text of the Ibero-American Summit:

"Are too!!"

"Am not!!"

"Are too!!"

"Yeah well so's your Mom!!"

It seems that Hugo Chavez called former Spanish Prime Minister Aznar a "facist"

Then current Spanish Prime minister Zapatero (literally, shoemaker) criticized Chavez for being disrespectful.

Then Chavez interrupted Zapatero's remarks.

Then Juan Charlie, King of Spain (KING I say!!!) starting yelling at Chavez to shut up and pointing his finger at him.

Socialist Solidarity indeed!!

You can read more about it here.

Leijonhufvud takes on Inflation Targeting

Monetary Economist Axel Leijonhufvud (who wrote one of the funniest pieces about economics ever) is not enthralled with inflation targeting. Here is a tidbit:

With the demise of Monetarism, more and more central banks around the world have come to adopt a policy strategy known as ‘inflation targeting.’ This is the case, for example, with the European Central Bank, the Bank of England, and the Swedish Riksbank. The Central Bank of New Zealand was a pioneer in committing itself publicly to this policy. Some other important
central banks, such as the Federal Reserve System of the United States and the Bank of Japan, have not officially declared inflation targeting as their strategy, but they have behaved as if it were, and the markets have believed that to be the case. Many influential advocates of this policy have argued that keeping the inflation rate very low and maintaining it within a very narrow band of variation should bea central bank's exclusive goal. If it is known that this is the Bank's exclusive objective, its policies will be transparent and, the proponents believe, as long as the markets understand clearly what the monetary policy is, they will take care of other matters, such as unemployment, as well as can be. If, on the other hand, the central bank from time to time trades off unemployment versus inflation, or one of the two versus the exchange rate, the private sector will not be certain what is going on and this will lead to various mistakes and inefficiencies. I have a number of reservations concerning this fashionable policy doctrine. In particular, I maintain that stabilising the consumer price index (or its rate of growth) does not guarantee stability of the financial system. Moreover, under certain conditions, concentrating on year-to-year monetary stability, in the sense of keeping to a CPI inflation target, can lead you to follow policies that are inimical to financial stability over the longer run.

Friday, November 09, 2007

All Roads lead to Crawford

This is what makes blogging so great. Alex over at MR posts about Cheatneutral, a "company" that provides infidelity offsets (that is actually a satire of carbon offsets). Then a bunch of his commenters go crazy complaining that carbon offsets are not a joke. I, thinking they are a joke, google the phrase "Al Gore Carbon Offset Fraud" and then in the muck and the mire I find this old but fascinating (to me anyway) information:

The 4,000-square-foot house is a model of environmental rectitude.

Geothermal heat pumps located in a central closet circulate water through pipes buried 300 feet deep in the ground where the temperature is a constant 67 degrees; the water heats the house in the winter and cools it in the summer. Systems such as the one in this "eco-friendly" dwelling use about 25% of the electricity that traditional heating and cooling systems utilize.

A 25,000-gallon underground cistern collects rainwater gathered from roof runs; wastewater from sinks, toilets and showers goes into underground purifying tanks and is also funneled into the cistern. The water from the cistern is used to irrigate the landscaping surrounding the four-bedroom home. Plants and flowers native to the high prairie area blend the structure into the surrounding ecosystem.

No, this is not the home of some eccentrically wealthy eco-freak trying to shame his fellow citizens into following the pristineness of his self-righteous example. And no, it is not the wilderness retreat of the Sierra Club or the Natural Resources Defense Council, a haven where tree-huggers plot political strategy.

This is President George W. Bush's "Texas White House" outside the small town of Crawford.

Holy Crap! Maybe Al can buy the carbon offsets he needs for his oversized, 20 room, $30k annually in electricity and gas bills, home from the SHRUB!!!

All I can say is, thank you Al for inventing the internet tubes.

Heat - Dolphin Deathmatch: Who will win first?

The NBA roll of shame is still long: Seattle, Golden State, Miami, Washington, and Minnesota. In the NFL, the wannabes have dropped away and the winless now include only Miami and St. Louis. Alone atop the confluence of these rosters of woe stands the city of Miami like a colossus! Congratulations to Miamians for living in the worst sports city in America right now.

Our question though, is which hapless Miami franchise will get a W first? Sunday, the Dolphins play the 4-4 Bills at home. That's gotta be a tossup at worst. The Heat play the Suns at home Friday (I'm penciling in an L) and travel to the Garden to play the Knicks Sunday (ditto).

The bottom line for the Heat may well be that until D-Wade walks through the door, they aren't going to win a single game. Shaq is averaging 13 points, 6 rebounds and 3 turnovers and doesn't really look very Shaqlike so far at least. Aside from Haslem, the rest of their roster is a horror show. Jason Williams shooting 34%? Penny Hardaway playing 18 minutes a night? Smush Parker shooting 28%? Daequan Cook? Dorrell Wright? Ricky "shoot at my own basket to make a fake triple double" Davis? Say it ain't so Pat Riley.

Given that Wade is practicing now, I'd say that the Dolphins must win Sunday or else it will turn out to be the Heat that gets the city of Miami off the sporting schneid. Either way, it's going to be a long, long, warm and humid winter in Miami.

Thursday, November 08, 2007

Rep. Ron Paul at today's JEC meeting with Bernanke

The best way I could describe the problems that we face here in this country, as well as the problem the Federal Reserve faces, is that we are indeed between a rock and a hard place because we have a serious problem but we don't talk about how we got here. We talk about how we're going to "patch it up". The bubble has been burst - we saw what happened after the Nasdaq bubble burst and we don't ask how it was created and then we had a housing bubble and it's deflating and it's spreading.

Yet nobody says, "Where does it come from?" and what is the advice that you generally get? Inflate the currency. They don't say "inflate the currency", they don't say "debase the currency", they don't say "devalue the currency", they don't say "cheat the people who have saved", they say "lower the interest rates". But they never ask you and I never hear you say, "the only way I can lower interest rates is I have to create more money".
Unless we get down to the bottom of it and define what inflation is and not look at only prices... this was taught by the free market economists all through the 20th century, they said, "Beware, they will increase the money supply but they will make you concentrate on prices and they will give you CPIs and PPIs and they'll fudge those figures and they'll talk about wage and price controls to solve our problems".

We ignore the fundamental flaw and that is that not only have we had a subprime market in housing, the whole economic system is subprime in that we have artificially low interest rates. And it wasn't under your tenure in office - it's been going on for ten years or longer and now we're bearing the fruits of that policy. A one percent interest rate and that's not a distortion? Instead of looking at consumer prices, that nobody in this country really believes, we need to talk about the distortion, the malinvestment, the misdirection, the bad information that is gotten from artificially low interest rates.

Well said Ron! (hat tip to Tim Iacono)

Excuse, I'm Going to the Head

President Bush, regarding President Musharraf: "You can't be the president
and the head of the military at the same time." (Yahoo link)

1. Wouldn't a strict constructionist point out that the U.S. Constitution says "The President shall be Commander in Chief of the Army and Navy of the United States"?!

2. Haven't MANY of Pres. Bush's claims of executive privilege been based on PRECISELY the fact that he is Pres and Head "at the same time"?

3. Now that I think of it, Pres. Bush is right, and can use his own example as proof.

(Nod to KL)

Time to Short Sell Domestic Pisco Manufacturers?

I am a free trader. I understand that multilateral agreements are probably the better way to go over bilaterals, but I generally like the bilateral ones as well, though it always troubles me that the text of a "free trade" agreement can be more than 2 or 3 sentences long (NAFTA runs into the thousands of pages I believe).

However, I am not sure that anything George Bush and Nancy Pelosi agree on can be very good economic policy, so I am stumped by the following from the NY Times:

In a rare show of bipartisan cooperation, President Bush and House Speaker Nancy Pelosi appealed Tuesday for passage of a free-trade agreement with Peru in a vote scheduled for Wednesday in the House of Representatives.

If approved by the House, the pact could revive the administration’s trade agenda and propel faltering trade deals with Panama, Colombia and South Korea, all of which are awaiting Congressional approval.

Nearly all 200 Republicans are expected to support the Peru deal, making it possible for the measure to pass with only a small number of Democrats. Some put the number of Democratic votes in favor at 75, and it could go higher. A favorable Senate vote is considered likely.

What do other prominent Democrats think, you ask?

Former Senator John Edwards opposes the Peru deal, Senator Barack Obama has endorsed it and Senator Hillary Rodham Clinton has not announced a position but has expressed skepticism about trade deals generally.

Don't fret Hill, I'm sure you'll figure out how to get on both sides of this issue too!

Wednesday, November 07, 2007

More good economic news (no wonder the mkt is tanking!)

Specifically, labor productivity grew by 4.9% in the 3rd quarter.

The Labor Department reported that productivity -- the amount of output per hour of work -- jumped at an annual rate of 4.9 percent in the July-September quarter. That was double the 2.2 percent rise in the second quarter and represented the fastest surge in worker efficiency since 2003.At the same time, wage pressures eased with unit labor costs dropping at an annual rate of 0.2 percent, the best showing in more than a year.

Both outcomes were far better than had been expected and should relieve some of the concerns that a remarkable surge in productivity that began in the mid-1990s was in danger of being reversed.

The slight drop in wage pressures was especially welcome after hefty increases over the past four quarters. Rising wages are good for workers but if they are not accompanied by strong productivity gains, they raise concerns among Fed policymakers about inflation.

The 0.2 percent decline in unit labor costs in the third quarter followed a 2.2 percent increase in labor costs in the second quarter and even bigger jumps of 5.2 percent in the first quarter and 10.3 percent in the fourth quarter of last year.

The article even gives its own punchline!!

Wall Street was not impressed with the big rise in productivity and slowdown in wage pressures, preferring to worry about the weakness of the dollar against other currencies. The Dow Jones industrial average was down more than 240 points in afternoon trading.

Is Hugo Chavez really helping Venezuela's Poor?

Here is an affirmative answer from the fascinating blog Oilwars

Here is a negative answer from an ex-pat Venezuelan economist

One thing that's indisputable is that Hugo is greatly helping the self esteem of American celebrities as Anne Appelbaum writes over at Slate.

Should U Drink the Celtic Koolaid?

Not yet.

Yes, Boston is 2-0 and Kevin Garnett looks younger and happier. He is taking and making about the same amount of shots as last year but his rebounding and assists are way up. Paul Pierce is taking and making about the same amount of shots as last year.

But so far it's Ray Allen who is sacrificing, getting only 13 shots per game in over 43 minutes per game, compared to 21 shots per game in 40 minutes per game last year. His scoring hasn't dropped too much yet though because he's made over 60% of his shots so far (Pierce is not exactly lighting it up at 39% from the floor).

I am not sure how Ray and Paul can co-exist, and I am not sure how the Celts are gonna take care of the ball. They are averaging 20 assists to 16 turnovers and their point guard, who I take to be Rajon Rondo, is averaging 2.5 turnovers to 2 assists in 30 minutes per game.

yuck. By contrast, in 3 games the Pistons are averaging 22 assists to 12 turnovers and Chauncey has 7.7 apg to 2.3 turnovers per game. If the Celts had CP3 at the point, i'd say "drink up" but they don't, don't, don't.

PS. How is this setup better for KG to win "his" title than back 03-04 when he had Spree and Sammy in Minnesota? Is it just 'cause that was the West and this is the East? I do not think Boston will be fondling the Larry O'Brien this summer.

Tuesday, November 06, 2007

Leon Spinks in a Rap Song!

I really like Lupe Fiasco. My favorite song of his right now is "dumb it down". I am only putting a link to the video rather than embedding it so that you can read the following before viewing: This is a rap video. It has many bad words in it (not from Lupe, but from his discontented Greek Chorus). That said, it's very very good.

You have been warned. Here is the link

Don't you wish they would clean up pop music??

Well wishes do come true!

One Solution to Rent-Seeking Games is to...STOP PLAYING!!!!

"Some stopped at the barricades to snap images of the picketers but were
waved along by police officers. 'They're writers. Couldn't they come up with
anything better than 'On strike?'' asked one officer, gesturing to the
signs...Some industry executives even believe a strike, although potentially
damaging to the business, could carry some side benefits. If a strike were
to extend into February, it would disrupt the TV pilot season, the
three-month period when studios make dozens of new shows as part of an
expensive annual competition to win a coveted spot on the prime-time
schedule of the five broadcast networks. The television companies
collectively spend more than $400 million a year on development and pilot
costs even though only a fraction of these shows achieve long-term financial
success. TV executives have long complained that the frenetic competition
for actors, directors and sound stages doesn’t translate into higher-quality
television, just higher costs...So for some TV executives, blowing up pilot
season is not such a bad idea." (LATimes)

"They're writers. Couldn't they come with anything better than "on strike"?" I enjoyed that. Apparently the cop is considering going scab, and crossing the line. That's funnier than a lot of what the writers have been putting out.

The Unskilled are also Unaware

"Why the unskilled are unaware: Further explorations of (absent) self-insight
among the incompetent"

Joyce Ehrlinger, Kerri Johnson, Matthew Banner, David Dunning & Justin
Organizational Behavior and Human Decision Processes, forthcoming

People are typically overly optimistic when evaluating the quality of their performance on social and intellectual tasks. In particular, poor performers grossly overestimate their performances because their incompetence deprives them of the skills needed to recognize their deficits. Five studies demonstrated that poor performers lack insight into their shortcomings even in real world settings and when given incentives to be accurate. An additional meta-analysis showed that it was lack of insight into their own errors (and not mistaken assessments of their peers) that led to overly optimistic estimates among poor performers. Along the way, these studies ruled out recent alternative accounts that have been proposed to explain why
poor performers hold such positive impressions of their performance.

Hmmmm....I'm really good at Putt-Putt golf. Just ask Angus.

(Nod to KL, who knows what he's good at)

"Chee-KAH-go boy" makes good

Agustin Carstens, Mexico's Finance Minister, is a busy man these days. Last week he spent the first part trying to calm markets that revised inflation figures were nothing to worry about. The second half of the week he spent assisting his boss, President Felipe Calderon, tackle the aftermath of the floods that hit Tabasco state and caused more than $500 million in damages to local agriculture....

Like many other influential policymakers in Latin America the past decade, Carstens is a "Chicago boy." He earned his M.A. and Ph.D in economics from the University of Chicago. In fact, he managed to get his PhD in 1985, only two years after getting his M.A. "That must be the fastest Ph.D on record," Alberto Ibarguen, a former publisher of The Miami Herald said when introducing Carstens to the Inter-American Dialogue dinner last week.


Actually, Angus did that, too. He finished his PhD two years after his MA, at Wash U.

Since this is apparently an important qualification, I nominate Angus for Finance Minister of Bolivia. You heard it here first.

"I have set several world records in that bathtub"...And other stories

Snake-sitting man.

White Castle latkes.

"You found it!" Mold....

Animal experimentation, OK style: Elephant on acid

Centrist Civilian wins Guatemalan Presidency

While pre-election polls pointed to a dead heat between the candidates, textile magnate Alvaro Colom defeated General Otto Perez Molina to win the presidential election in Guatemala.

According to Reuters: voters with bad memories of atrocities under military rule rejected Perez Molina's plans to send more soldiers onto the streets, boost the use of capital punishment and emergency powers to fight crime. Perez Molina conceded defeat.

"It is a 'no' to Guatemala's tragic history," Colom, 56, said when asked if the vote was a rejection of the country's military past.

Politics is not a spectator sport in Guatemala: The election campaign was marred by violence, with more than 50 political party activists or candidates for Congress or local elections killed. Colom's party was hardest hit with almost 20 party members murdered since last year.

For further analysis of the election look here.

Monday, November 05, 2007

I'm Ready for my Closeup, Mr. Demille!

Marc Andreessen is not impressed by how the media moguls are handling their writers. He asks, in part, WWWDD? (what would Walt Disney Do??).

Gas Prices got U down? Consider moving to Venezeula...

......where gasoline retails at the pump for around $0.07 per gallon!

Tyler recently noted that price controls were making a big time comeback. In the comments, I noted that he and others he cited had left Venezuela out of the list of controllers. Serendipitously, the NY Times Sunday mag contains a long piece about oil and Venezuela. Some highlights:

Pdvsa is also subsidizing Venezuela’s domestic oil consumption. Cheap oil for Venezuelans is nothing new; when President Pérez tried to raise gasoline prices in 1989, the riots nearly toppled him. The Venezuelans feel it is their oil; why should they have to pay for it? But the subsidies are much deeper and the quantities greater today. A gallon of gasoline costs 6.3 cents at the pump at the unofficial exchange rate. And Venezuela is now gorging on gas. Venezuela will add 450,000 new cars this year — about four times the number of four years ago. Six Hummer dealerships are set to open early next year.....

Inflation is officially at 16 percent but is most likely higher, according to Orlando Ochoa, the economist, who is usually critical of Chávez. He says that in the basket of goods and services used to measure inflation, just under half the items are sold at government-controlled prices. Many goods simply can’t be bought at those prices, and consumers must pay double the price in a street market. Or the goods can’t be found at all, their producers forced out of business by price controls. Beans and sugar were hard to find cheaply when I visited Caracas in September; fresh milk and eggs hard to find at all. Recently, people had to line up for five hours to get a liter of milk. One proposal in Chávez’s constitutional referendum could increase inflation much further by abolishing the autonomy of the Central Bank and giving the president power over Venezuela’s international reserves. The proposal would also essentially allow Chávez to print money.

The major threat to the economy comes from the exchange rate. Oil caused the bolívar to be overvalued. Farms and factories are in trouble. They can’t export and must compete at home with products imported at the official exchange rate, which is now about a third of the market rate. And so the country is awash in artificially cheap imported products, from basic foodstuffs, like Brazilian cooking oil, to fancy cars. “Our productive capacity is too weak to create jobs,” Petkoff says. “But we consume like a rich country.”

The disparity between the official exchange rate (2,150 bolívars to the dollar) and the black-market rate (6,200 bolívars at press time) has created a new class known as the Boliburgesía. Bankers, traders, anyone who works in finance or commerce, can get very rich manipulating the exchange rates. Buy all the imported whiskey and Hummers you want, is the message. Live a life of wild excess. Just don’t try to produce anything.

Hmm..... maybe paying $2.85 a gallon ain't so bad after all.

Sunday, November 04, 2007

Wrong, in so many ways.....

An email from a friend, with some commentary below....

Read this question, come up with an answer, and then scroll down to the bottom for the result. This is not a trick question. It is as it reads.

No one I know has been right.

A woman, while at the funeral of her own mother, met a guy whom she did not know. She thought this guy was amazing. She believed him to be her dream guy so much, that she fell in love with him right there, but never asked for his number and could not find him. A few days later she killed her sister.

Question: What is her motive for killing her sister?

[Give this some thought before you answer, see answer below]

(Play the Jeopardy music here)


She was hoping the guy would appear at the funeral again. If you answered this correctly, you think like a psychopath. This was a test by a famous American Psychologist used to test if one has the same mentality as a killer.

Many arrested serial killers took part in the test and answered the question correctly.

If you didn't answer the question correctly, good for you.

If you got the answer correct, please let me know so I can take you off my email list...

Interesting that these things become internet cascades. As Snopes notes, this one is not even very plausible.

Yet, three people have sent it to me.

Delete it, please, don't forward it.

Masks: How much stripping do you really want to see?

As the dialogue went:

EVEY: Is that why you're wearing a mask?

V: We all wear masks. Life creates
them and forces us to find the one
that fits. Do you know what day it is?

A video, about...stripping off masks.

Vote: For Betsy!

I should note an ACTUAL deserving blog.

Please vote for Betsy......

You can vote for EconTalk while you are at it, but by all means vote for Betsy.

Vote Early, Vote Often!

Fight the power! An extremely close race, between Econtalk (that's the angel), and "The Glenn and Helen Show" (that would be Satan).

You can vote once every 24 hours, from EVERY IP ADDRESS you have available.

It's close and we need your help.

Voting takes about 5 seconds, or less. Please! VOTE!

Nachas: Fall Baseball 2007 version

I learned a new word last fall, "nachas", from my friend at Newmark's Door.

Of course, I already knew what nachas FELT like, as most parents do.

This fall, same baseball league:

Semifinal game, city tournament, Raleigh v. Wake Forest, scheduled starter couldn't make it, late and a bit sick. My son Brian pitched.

He threw a complete game (7 inn) shutout, against a good team. Pitching line:

IP 7
R 0
ER 0
H 3
K 15(!)
W 5

They won, 3-0.

His only problem was the fourth, where leadoff guy gets on on an error, Brian walked the next two. But then he struck out two, and caught a fly ball to get out of the jam.

Complete games are extremely rare, even though "CG" is only 7 innings. Kids just lose concentration. I think it helped him that he scattered 3 hits and 5 walks, because it kept him just on the edge.

But in the 6th, he struck out 4 guys (on PB allowed the runner to get on, a curve int he dirt). And in the 7th he struck out two more, on 8 pitches.

Then we went to Taco Bell. I had Nachas Grandes.

Final game, city tournament, 15-17 year old league: tomorrow night, Monday. Will advise.

Baseball: Yer doin' it wrong (special Japanese Edition)

The "world series of Japan" just ended with the Chunichi Dragons defeating the defending champ Nippon Ham Fighters 4 games to 1.

Daisuke Yamai was the game 5 starter for Chunichi, and he did a little thing we like to call PITCHING 8 PERFECT INNINGS!! Yes my friends, 24 Ham Fighters up and 24 Ham Fighters down. In the 57 years of the Japan Series, there had never been a perfect game. In all the history of the US world series there has only been one perfect game (Don Larson y'all!).

Well there still has not been a perfect game in the Japan Series because the Dragons manager TOOK DICE Y OUT AND BROUGHT IN A RELIEVER TO PITCH THE 9th!!!!!!

I am not making this up. They were up 3 games to 1. The guy needed three more outs for immortality. And the manager gave the ball to someone else (who retired the side in order, but multi-pitcher perfect games aren't real perfect games).

I've used BDM's forecasting model to scientifically determine the chances that this could happen in the United States. Answer: 0.00%. Squadoosh. The pitcher has to get a chance to finish the perfect game.

Talk about inscrutable. wow.