oil prices

Given that certain countries are highly dependent upon oil earnings for their government budgets and economies generally, how much political work goes into destabilizing other oil producing countries (and thus both permitting increased deliveries and increasing prices)?

pet peeve on GDP reporting

Why do writers regularly compare market caps and other wealth measures with GDP of countries?

It is really quite meaningless and shameless.  Now, for a market cap to equal the estimated value of a country - that would be awesome.

For the most egregious example of this, see this gem.  For a move in the right direction, see this that compared Glencore's revenues with Ukraine's GDP.

Economic Growth

A reasonable NYT article on economic growth (in particular, growth in China) but relevant on a variety of fronts.

There is one aspect that sticks out.  The article (and cited sources) suggest that growth reverts to the mean and that superior growth will inevitably decline over time.  And notes that the USSR and Japan were both expected to surpass the US but never did.  This seems to gloss over the US's high growth over a long period.

My thumbnail view on growth, in particular, growth in the US:

1) huge natural endowment;
2) significant immigration and high birth rate; and
3) most importantly, strong property rights and rule of law.

#1 helped to give a head start and encourage #2 but, ultimately, it is #2 and #3 that allowed above trend growth to continue.  As a nice example, see the eventual stumbling of the USSR and Japan for #3 and #2, respectively (notwithstanding the large #1 of USSR).

police stops as a proxy for social equality

I wonder what the incidence is of police stops of high-end cars around the world?  I'm thinking this could be an interesting measure of evenhanded enforcement/social arrangements around the world.  For example, notwithstanding its relatively high gini-coefficient, my guess is that most new BMW drivers feel they are as likely (or perhaps even MORE likely) to get stopped by the police.  I wonder how common this feeling is in other places.

a period of inefficient utilization of computers

I wonder if the past decade will be seen, oddly enough, as a trough of efficiency and productivity.  I wonder this because we are currently hampered by both our inputs (keyboards are unwieldy, voice is inaccurate, etc.) and outputs (screens are still small and only recently have ultra-high resolutions).  Until I can replicate the massive amount of readily visible and accessible information as I have in an unfolded road map, I think there may be a lot of room for productivity gains from computers.

bond yields

What if people are using bond proceeds to buy bonds (leveraged bond purchases)?  Would it be possible for the demand side of this to result in lower overall rates?  And so reinforce a low rate environment?

gas rationing

Gas rationing with odd-even license plate numbers is not really rationing.

I think it is labeled rationing but is really an interesting form of externally imposed impulse control.  Normally, with a ration, there is a prescribed amount available per person per period.  Here, none of those constraints actually imply.

Instead, by imposing "rationing" what we are really doing is limiting impulse and fear.  Impulse (at least half of consumers will now need to defer purchases by a day and all will need to plan somewhat) and fear (because there is now a plan, the desire to "get gas before they run out" eases as there is less concern about "running out").  I wonder who thought of it.

Education and an usual side-effect of opportunity

How much of the claimed declines in US academic performance/quality of education is a result of MORE opportunity for women and meritocracy?  When there were more and higher (not that there are none today) barriers to women entering the workforce, how many women became teachers who, today, would be high-powered lawyers, doctors, etc.  And thus were able to provide exceptional educations because they were actually over-qualified (or, given that teaching standards are usually quite low, more qualified than demanded by schools but actually the "right" level of qualification).  Of course, this doesn't explain all the gaps in education (some Scandinavian countries have very high quality of education but a very egalitarian society) - but it also seems to play a role.

Microsoft Brands

Something is jarring about this clause from today's NYT:  "[Microsoft] is marshaling some of its most powerful brands as never before: Windows and the Xbox."


Windows is undoubtedly well-known.  But "powerful"?  I think of a powerful brand as one that has such strong and favorable connotations that, by simply lending its name to another product, it can also bestow some of its good will.  Windows does not strike me as such a brand. Moreover, extending a brand is risky - better to share the name with equally good products rather than hope consumers will never notice that the new thing is not quite like the old.

Chrysler resurrected

If Chrysler really does turn around and become a successful manufacturer for a meaningful period, I wonder if it is because Chrysler, out of nearly all other manufacturers, is very much a hit-driven company.  More specifically, they have often sold style in a mass market which, like most mass markets, is generally geared towards efficiency, reliability, etc.  And thus, control by an Italian group, from a country that manages to sell goods based more on emotion than data, could be the perfect fit for success.

japan-style deflation

Was deflation the cause or the symptom of the weak economy?  I suspect it was more a reinforcing symptom but that, even without deflation, the economy would still have been moribund.  Just thinking about QE2 and its purported goal of avoiding deflation (rather than pumping up asset prices, especially housing and equities).

turmoil

Startling that there seem to be three relatively full-fledged civil wars going on in the middle east - all either in or directly adjacent to large oil producers - and yet no sense of impending doom or panic.  Am I missing something?  For example, not to see conspiracies, but that these are somewhat regulated conflicts where the ending is both preordained and better for the west?

Intellectual Property and China

Perhaps it is cases like this (Huawei sues ZTE for infringement) that will lead the way to a maturing perspective on IP in China.  Not "us vs. them" but rather an evolution to creating enough value that it is worth protecting.

South Korean success

I wonder how much of Korea's success in the recent crisis is a function of having very good but often not the very best products (and being able to price more competitively as a result).  Not merely because as rich country consumers "traded down" they saw the value in Hyundais over Hondas, but also because, for a large part of the global economy (emerging markets) Korean products are their products.  And so, with a different export and customer and a bias towards the customers who survived, Koreans did exceptionally well?

iPad battery

Assuming improved iPads are released over time, doesn't this (that Apple will just ship a new machine rather than actually replace the battery) mean iPads are expected to drop in price significantly (or, extremely unlikely, that Apple will somehow keep a large inventory of obsolete iPads)?  Otherwise, each time there is a new version, owners will suddenly "discover" that their iPads no longer hold a charge and require an exchange (which, naturally, will mean the new version of the machine as the old ones disappear).  I'd recommend waiting a few months to clear out the refurbs and old inventory before trying this gambit...

health care and education

Will the government's increased role in health care cause it to more closely resemble the education system?  The U.S. public school system used to be world class.  It clearly no longer is as a whole.  But, some private schools and higher education institutions continue to be very good (for a price).  And teaching is generally a second-choice career.  Will medicine follow?  Where, because we start with today's quality, it will be hard to perceive its decline for many years?  And we will find ourselves in a two-tier system where many of the participants receive the lower-tier quality?  And, perhaps far into the future, agitation for vouchers or similar market based incentives (needing the years in the desert to internalize that the highest quality medicine cannot be available for all for free)?

Intel antitrust

I don't know the relative merits of the case but I would note that Intel doesn't seem to have sat on its heels despite its dominant position.  I would say some other companies with antitrust issues have not made as many significant improvements in their products as Intel has in microprocessor speed.  But who knows, maybe Moore's Law could have been surpassed with a freer market.

I'm pretty sure I've heard this story

Gold, stocks, etc. have been rising recently.  Isn't most of this simply a function of a declining dollar?  In other words, inflation?  An asset bubble?  Much of the government's stimulus efforts seem to have been translated into increased holdings of financial assets rather than increased spending.  Which isn't great for TIPS (CPI flat, asset prices way up).

Oh well.

reserve currency

To a large extent, isn't a reserve currency simply a function of minimizing transaction costs?  Especially transaction costs relating to acquisition of supply for businesses.  The dollar is useful as the basis of trade because a fair portion of global expenditures are in dollars.  If more is produced in China, at a certain point, people should be comfortable holding Chinese Yuan because they know they will be able to spend it.  I wonder how much of the status of the U.S. is based on its years of being the core manufacturer and agricultural producer of the world.

City = Green

I'm pretty sure this article says basically the same thing as the New York Times Magazine piece a few years ago (which I can't find at all).  But that's fine with me as the message is more relevant than ever.