Happy Place

Local Happiness and Firm Behavior: Do Firms in Happy Places Invest More? 

Tuugi Chuluun & Carol Graham 
Journal of Economic Behavior & Organization
May 2016, Pages 41–56 

Abstract: We examine a previously unexplored relationship between local happiness and firm investment. We looked at investment in general and R&D intensity in particular, as the relatively intangible nature of the latter may make it more subject to the effects of sentiment and affect. We find that average local happiness is positively correlated with both R&D intensity and firm investment, after controlling for firm and local area characteristics. This positive relationship may be due to the optimism and longer term perspectives that are typically associated with higher levels of life satisfaction/happiness. We also look at inequality in happiness levels and find that the effect of local happiness is stronger in places with more equal happiness distributions. Younger firms’ investment behavior is also more strongly correlated with local happiness levels. The results remain robust to a battery of robustness tests including the use of residual and hedonic measures of happiness, analysis of a sample of relocated firms, and a test for reverse causality.

Treading Water

So, on May 21, I said that the sky was falling, and I was bailing.  Took everything out of stocks, and invested in bonds.  Mostly in the TIAA-CREF's "inflation-linked" bond product.


On May 21, the DJIA was 12,450.  Today, it is 12702.  That's up about 2% since I ran and squealed.  DJIA has been higher, as high as 12,900, and as low as 12,100, since May 21.  But right now, it's just over 12700.  The inflation linked bond is up about 1.2% since May 21.


So, clearly, you are better off ex post if you stayed in stocks.  But I have been sleeping well.

Baseball Cards--Mr. Mint is Sad

Tommy the Tenured Brit writes, "I weep for the loss of my 1980s childhood. Still, it was quite commonsense to me at 12 that any baseball card produced after 1985 or so would not be very valuable long term..."

The story: Baseball's House of Cards

Why In the World Hire an "Investment Broker"?

Craig Newmark discovers the answer to one of life's most difficult questions: why would anyone hire an "investment broker"?

Brokers, after all, make people.... broker. They sell products they don't understand to yokels they don't care about.

But, as Craig notes, now there is an answer.

Got a call from an investment broker the other day myself. I made two claims, rather loudly.

1. No one can make predictions about the stock market, or super normal returns in assets, unless they inside information. And if they had same, they would TRADE on that information, borrowing all the money they can scoop up. They wouldn't call an idiot like me and GIVE me the information over the phone.

2. Idiot or not, I went 100% cash and short bonds in August 2007. And went back about 50% into stocks in April 2009. How many of your clients did you advise to do THAT, Mr. Investment Broker?

We didn't talk long after that.

Honey Badger still don't care

Hat tip to Keith G.