Wednesday, February 25, 2009
Utah, we have a big problem
The porn issue is pretty unsettling, but there's something potentially even more so. What's with Utah's addiction to MLM? I just returned from a visit to one of our local purveyors of high-end exotic juices. They have some of the most posh real estate I've been in (and I've been in some pretty posh offices). Who are the fools that are still getting friends to sell acai juice for them? I squirm to pay extra for higher end root beer at the grocery store and I don't have to get anyone else to sell it. This is the (most bizarre) place.
Will it blend?
Katie's currently hoarding our Amazon gift certificates to buy a Blendtec. Please keep it away from my skis.
Tuesday, February 24, 2009
At least they understand the problem
An ironic article shows that of the 18 people assigned to the federal task force on the auto industry, they collectively own two American cars.
Utah, we have a problem
According to a new publication from Harvard (Journal of Economic Perspectives), Utah is by far the state with the highest consumption of online porn. The good news is they don't look at it on Sunday. The bad news is they make up for it in spades the other six days of the week. Ugh. (I'm sure this is driven somewhat by a lower consumption of offline porn, but still...)
I preferred being known for consumption of ice cream and jello.
I preferred being known for consumption of ice cream and jello.
Tuesday, February 17, 2009
Friends can do anything
You've heard that some people can move mountains, heaven and earth, etc.? My friend Judd can move entire cities.
Normal people, like me, think that there are some dilemma's that just can't be solved for. In this case, Judd's been trying to get me to move into his neighborhood so the black helicopters can save gas by watching us together. However, he lives south of the border. The county border that is - he lives in Happy Valley. We folk north of the border are a bit uncomfortable with those south of the border, especially ex-Utes. More importantly, Katie would like to live close to her family in Sugarhouse. So I told him there's not much chance of us moving to Lehi unless he can convince my sweet that it lies between Draper (my job) and Sugarhouse.
Lo and behold, it does. Check out the map of SL neighborhoods on the right. In case Wikipedia reverts the edits someone made, I'll also save a png. Well, Katie, Traverse Mountain it is! And if it turns out that Sugarhouse is still too far away, I'm sure Judd can just move it closer.
Judd, can you also lower ceilings? (more on that another time)
Normal people, like me, think that there are some dilemma's that just can't be solved for. In this case, Judd's been trying to get me to move into his neighborhood so the black helicopters can save gas by watching us together. However, he lives south of the border. The county border that is - he lives in Happy Valley. We folk north of the border are a bit uncomfortable with those south of the border, especially ex-Utes. More importantly, Katie would like to live close to her family in Sugarhouse. So I told him there's not much chance of us moving to Lehi unless he can convince my sweet that it lies between Draper (my job) and Sugarhouse.
Lo and behold, it does. Check out the map of SL neighborhoods on the right. In case Wikipedia reverts the edits someone made, I'll also save a png. Well, Katie, Traverse Mountain it is! And if it turns out that Sugarhouse is still too far away, I'm sure Judd can just move it closer.
Judd, can you also lower ceilings? (more on that another time)
Protect depositors not investors/bankers
Marginal Revolution gives a cogent argument for reorganizational bankruptcy of insolvent banks, even if this leads to temporary "nationalization":
The debate so far has been framed between a "bailout" and "nationalization." But the public rightly sees the bailout as a way to protect bankers and thus we get pressure for government ownership, which has already happened in part through government control over banker wages. Bankruptcy in contrast is a normal free market procedure, it emphasizes that the firm has failed and current management should be removed. Framing the issue in this way, for example, makes it clear that only the depositors should be protected and under reorganization there should be no control over wages on future management (wages are going to have to be high to get anyone to take on the task). Finally the idea of bankruptcy makes it clear that the goal is to get banks solvent, under new management, and back under private control as quickly as possible.
The debate so far has been framed between a "bailout" and "nationalization." But the public rightly sees the bailout as a way to protect bankers and thus we get pressure for government ownership, which has already happened in part through government control over banker wages. Bankruptcy in contrast is a normal free market procedure, it emphasizes that the firm has failed and current management should be removed. Framing the issue in this way, for example, makes it clear that only the depositors should be protected and under reorganization there should be no control over wages on future management (wages are going to have to be high to get anyone to take on the task). Finally the idea of bankruptcy makes it clear that the goal is to get banks solvent, under new management, and back under private control as quickly as possible.
Translating time
I came across this paper from our friend Kathleen Flake yesterday. Not easy reading - Kathleen's one of the deeper people I know - but very interesting and a revealing view of the writings of Joseph Smith, both how and why they created a fundamental break from traditional Christianity and oriented his believers in a new narrative and theological construct.
Monday, February 16, 2009
Scared yet?
How about a gold ol' run on the bank in Eastern Europe to further destabilize the world economy:
Stephen Jen, currency chief at Morgan Stanley, said Eastern Europe has borrowed $1.7 trillion abroad, much on short-term maturities. It must repay – or roll over – $400bn this year, equal to a third of the region's GDP. Good luck. The credit window has slammed shut....
"This is the largest run on a currency in history," said Mr Jen.
My friend Judd gave this presentation at UT last week, describing how hedge funds are to blame for this mess, starting with the assault on Bear Stearns and Lehman. Will be interesting to see if some of these guys end up frog-walking a la Kenneth Lay before this is all said and done.
How's that food storage coming along? Sure wishing this cursed house would sell...
Stephen Jen, currency chief at Morgan Stanley, said Eastern Europe has borrowed $1.7 trillion abroad, much on short-term maturities. It must repay – or roll over – $400bn this year, equal to a third of the region's GDP. Good luck. The credit window has slammed shut....
"This is the largest run on a currency in history," said Mr Jen.
My friend Judd gave this presentation at UT last week, describing how hedge funds are to blame for this mess, starting with the assault on Bear Stearns and Lehman. Will be interesting to see if some of these guys end up frog-walking a la Kenneth Lay before this is all said and done.
How's that food storage coming along? Sure wishing this cursed house would sell...
Thursday, February 12, 2009
Deep waters
My mom forwarded me an address from Mitt Romney this morning that I thought was very well done. I had to find the original though to make sure it was really from him. It turns out he's given the same speech in several variations at different times. Here's one.
I like this bit:
Over the years, I have watched a good number of people live out their lives in the shallows. In the shallows, life is all about yourself, your job, your money, your house, your rights, your needs, your opinions, your ideas, and your comfort.
In the deeper waters, life is about others: family, friends, faith, community, country, caring, commitment. In the deeper waters, there are challenging ideas, opposing opinions, and uncomfortable battles. Almost every dimension of your life can be held to the shallows or taken into the deeper water. Your career, your involvement with others, your spouse and your children, your politics, each can be lived with you comfortably at the center. Or, they can draw you out of yourself, into service and sacrifice, into selflessness.
There are currencies more lasting than money. It can be enormously rewarding to take the unobvious course, to jump into the deep water. Bias is shallow thinking and shallow water. Read widely, particularly from people who disagree with you. Argue to learn rather than to win. If you don't respect, I mean really respect, the views of people who disagree with you, then you don't understand them yet. There are smart people on both sides of almost every important issue. Learn from them all. If you have life all figured out in neat little packages, you're in Neverland, not the real world. And it's boring there. There's one more thing I've seen in the people who swim in the deep waters of life. They don't fashion their values and principles to suit their self-interest; they live instead by enduring principles that are fundamental to society and to successful, great lives.
I like this bit:
Over the years, I have watched a good number of people live out their lives in the shallows. In the shallows, life is all about yourself, your job, your money, your house, your rights, your needs, your opinions, your ideas, and your comfort.
In the deeper waters, life is about others: family, friends, faith, community, country, caring, commitment. In the deeper waters, there are challenging ideas, opposing opinions, and uncomfortable battles. Almost every dimension of your life can be held to the shallows or taken into the deeper water. Your career, your involvement with others, your spouse and your children, your politics, each can be lived with you comfortably at the center. Or, they can draw you out of yourself, into service and sacrifice, into selflessness.
There are currencies more lasting than money. It can be enormously rewarding to take the unobvious course, to jump into the deep water. Bias is shallow thinking and shallow water. Read widely, particularly from people who disagree with you. Argue to learn rather than to win. If you don't respect, I mean really respect, the views of people who disagree with you, then you don't understand them yet. There are smart people on both sides of almost every important issue. Learn from them all. If you have life all figured out in neat little packages, you're in Neverland, not the real world. And it's boring there. There's one more thing I've seen in the people who swim in the deep waters of life. They don't fashion their values and principles to suit their self-interest; they live instead by enduring principles that are fundamental to society and to successful, great lives.
Wednesday, February 11, 2009
Job creation?
Disclaimer: I didn't choose the channel. I hate Fox News. But I was on the treadmill in my hotel this morning and it was on. Regardless of the horribly disreputable source (then again, is there a reputable source these days on tv?), they were showing a list of projects that had been submitted by the city of Philadelphia for part of the stimulus money. The projects were arguably valuable:
* Needed investment in the city zoo
* Investment in the airport runway (I'm a big fan of safe runways)
* Replacement of city's light bulbs with more energy efficient bulbs
* Etc
The projects were in a table with three columns - project, investment needed, jobs created.
As I looked at each of these I was struck, not by the waste of money, but the assumption that this was truly job creation. So if we sign off on number three and hire 200 people to replace all the light bulbs in Philly, what do we do three months later when they're all replaced? The economy's stimulated, the jobs were created, but now we just lay them off, right? Becker and Murphy state this more eloquently than me, but it seems to me that any short-term stimulus package focused on immediate spending and hiring will rapidly turn into either massive layoffs or, even worse, long-term commitments to an increased government cost base, employed or unemployed but now with qualified unemployment benefits.
Can we just give every American $4,000 to go spend on a new big-screen and call it good?
* Needed investment in the city zoo
* Investment in the airport runway (I'm a big fan of safe runways)
* Replacement of city's light bulbs with more energy efficient bulbs
* Etc
The projects were in a table with three columns - project, investment needed, jobs created.
As I looked at each of these I was struck, not by the waste of money, but the assumption that this was truly job creation. So if we sign off on number three and hire 200 people to replace all the light bulbs in Philly, what do we do three months later when they're all replaced? The economy's stimulated, the jobs were created, but now we just lay them off, right? Becker and Murphy state this more eloquently than me, but it seems to me that any short-term stimulus package focused on immediate spending and hiring will rapidly turn into either massive layoffs or, even worse, long-term commitments to an increased government cost base, employed or unemployed but now with qualified unemployment benefits.
Can we just give every American $4,000 to go spend on a new big-screen and call it good?
Stimulus wisdom
You're unlikely to find two more sage economists that Becker and Murphy, and I'm not just saying that because they're two of Chicago's finest. Here's their take on the stimulus from yesterday's WSJ. Cliff Notes version - bad news.
Thursday, February 05, 2009
Been a while since I let out a good rant
Economics needs a Newton, Carnot, Gibbs or Einstein. Physics and Thermodynamics have laws that are immutable and come in sets of three:
Physics:
1- An object in motion stays in motion until acted upon.
2- Force is mass times acceleration.
3- Every action has an equal and opposite reaction.
Thermodynamics
1- Energy cannot be created or destroyed
2- Disorder increases over time (entropy) – easy law to remember in a house with six kids.
3- Entropy is temperature dependent which means there’s an absolute zero (-273 C) – easy to remember this week in Kansas City; feels like we might have reached 0 Kelvin.
Economics has no such luck. Oh, there are rules and they’re pretty darn immutable, but there’s no Newton, as hard as folks like Keynes, Friedman and Hayek tried, to declare THE three and number them just right. So since they aren’t written in stone we can still try to thwart them – make gravity fall up. Curse you Robert Reich and all the rest of you whose names don’t come to mind nearly so easily as Robert Reich.
My list of three would probably be:
1- Goods are scarce. Not everyone can have everything.
2- Supply and demand. Market price is where the supply and demand come into equilibrium unless smart energy companies collude.
3- People respond to incentives.
Let me get on my soapbox about the final one with a hypothetical scenario that may feel like it’s straight out of yesterday’s paper.
Suppose you’re a political leader of a large capitalistic country going through a recession and you’ve handed out a “relief package” (or two) named after a common camping item to several companies. These are companies so large, so integrated into your economy, so critical for the rest of the economy, that you decide they can’t fail. You borrow your money, your kids’ money and your grandkids’ money to bail them out (all thanks to our Communist brethren to the East). Now you need the very best and the very brightest to take up the challenge of either joining or remaining at these companies on the brink of financial ruin to lead them back into financial health. Only the very best will do. How might you create the right incentives to get just the right people? Would you cap their pay and tell them no more expensive dinners and hotels? Would you tell them to sell the company jet (while standing on the stairs leading up into your own)? Would that get them jazzed up? Kinda seems to me that they might want to go to a healthy company, one not under distress or at least “less critical” to the economy and leave the 80% lower salaries, the Congresssional reviews and the bad press to a few of the dimmer lights on the tree.
Capping egregious pay of CEOs sounds like a cool, populist (ok, it’s 2009 and cool and populist are redundant – my bad) thing to do, but if you remember Law Number Three, you might think otherwise. Sure you don’t want “those same idiots that got us into the mess in the first place [other than our new Secretary of the Treasury – that’s different]”, but let’s assume we know that and we get rid of them and want to keep/hire the really, really best once the dumb ones are gone. A good old salary cap will help, right?
As much as $500K sounds to the average joe (like me), it’s a whole lot less than $5M and for a whole lot more hassle. No one turns down a pay raise or a bonus. No matter what you make, you don’t consider yourself rich. Rich is 10x what you currently make. I regret that I only have three laws to give for my country, or that could very well be #4.
I sure hope this stimulus works and 500,000,000 Americans don’t lose their jobs like Ms. Pelosi said they would. (HT-Annette).
(I wish I could have found a way to incorporate Pete’s firmament metaphor into this…)
Physics:
1- An object in motion stays in motion until acted upon.
2- Force is mass times acceleration.
3- Every action has an equal and opposite reaction.
Thermodynamics
1- Energy cannot be created or destroyed
2- Disorder increases over time (entropy) – easy law to remember in a house with six kids.
3- Entropy is temperature dependent which means there’s an absolute zero (-273 C) – easy to remember this week in Kansas City; feels like we might have reached 0 Kelvin.
Economics has no such luck. Oh, there are rules and they’re pretty darn immutable, but there’s no Newton, as hard as folks like Keynes, Friedman and Hayek tried, to declare THE three and number them just right. So since they aren’t written in stone we can still try to thwart them – make gravity fall up. Curse you Robert Reich and all the rest of you whose names don’t come to mind nearly so easily as Robert Reich.
My list of three would probably be:
1- Goods are scarce. Not everyone can have everything.
2- Supply and demand. Market price is where the supply and demand come into equilibrium unless smart energy companies collude.
3- People respond to incentives.
Let me get on my soapbox about the final one with a hypothetical scenario that may feel like it’s straight out of yesterday’s paper.
Suppose you’re a political leader of a large capitalistic country going through a recession and you’ve handed out a “relief package” (or two) named after a common camping item to several companies. These are companies so large, so integrated into your economy, so critical for the rest of the economy, that you decide they can’t fail. You borrow your money, your kids’ money and your grandkids’ money to bail them out (all thanks to our Communist brethren to the East). Now you need the very best and the very brightest to take up the challenge of either joining or remaining at these companies on the brink of financial ruin to lead them back into financial health. Only the very best will do. How might you create the right incentives to get just the right people? Would you cap their pay and tell them no more expensive dinners and hotels? Would you tell them to sell the company jet (while standing on the stairs leading up into your own)? Would that get them jazzed up? Kinda seems to me that they might want to go to a healthy company, one not under distress or at least “less critical” to the economy and leave the 80% lower salaries, the Congresssional reviews and the bad press to a few of the dimmer lights on the tree.
Capping egregious pay of CEOs sounds like a cool, populist (ok, it’s 2009 and cool and populist are redundant – my bad) thing to do, but if you remember Law Number Three, you might think otherwise. Sure you don’t want “those same idiots that got us into the mess in the first place [other than our new Secretary of the Treasury – that’s different]”, but let’s assume we know that and we get rid of them and want to keep/hire the really, really best once the dumb ones are gone. A good old salary cap will help, right?
As much as $500K sounds to the average joe (like me), it’s a whole lot less than $5M and for a whole lot more hassle. No one turns down a pay raise or a bonus. No matter what you make, you don’t consider yourself rich. Rich is 10x what you currently make. I regret that I only have three laws to give for my country, or that could very well be #4.
I sure hope this stimulus works and 500,000,000 Americans don’t lose their jobs like Ms. Pelosi said they would. (HT-Annette).
(I wish I could have found a way to incorporate Pete’s firmament metaphor into this…)
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