I'm short on time, but I don't want to lose track of some of these interesting points from the past few weeks.
Pres. Obama is a politician. His promises to voters to pursue science rather than politics are as credible as a prostitute’s promises to a client to pursue love rather than profit.
Arnold Kling does the best job I've seen of explaining the CAPM:
The portfolio separation theorem says that the number of portfolios that are needed to produce an optimum allocation is equal to the number of characteristics that investors care about. In particular, if investors only care about expected return (mean) and safety (minimizing variance), then every investor's portfolio can be computed as a mix of only two dominant portfolios.
David Brooks on the Grinds vs the Princes:
If you go to business conferences, you know that at lunch it is definitely better to be seated next to a prince than a grind.
Robin Hanson on the congestion vs scale:
Products and services (i.e., “goods”) can be divided into two types: those that on net suffer from congestion effects, and those that instead benefit from scale effects. For congestion goods, the more that one person consumes of the good, the harder it gets for others to consume it. For scale goods, in contrast, the more that some consume, the easier it gets for others to consume.
Don Boudreaux on why stimulus need not stimulate.
Arnold Kling on "neo-reactionaries:
The ruling class's appetite for deference, power, and perks grows. The country class disrespects its rulers, wants to curtail their power and reduce their perks. The ruling class wears on its sleeve the view that the rest of Americans are racist, greedy, and above all stupid. The country class is ever more convinced that our rulers are corrupt, malevolent, and inept. The rulers want the ruled to shut up and obey.
...The grandparents of today's Americans (132 million in 1940) had opportunities to serve on 117,000 school boards. To exercise responsibilities comparable to their grandparents', today's 310 million Americans would have radically to decentralize the mere 15,000 districts into which public school children are now concentrated.
Arnold Kling gives reasons for pessimism regarding unemployment:
Robert Fogel tells us that the three long-term superior goods are leisure, health care, and education. Obviously, an increase in leisure does not increase employment, although it certainly creates opportunities in complementary goods and services.
But health care and education in the U.S. are arguably the most cartelized labor markets in the world. How many entrepreneurial ideas in those fields are rendered implausible by credentialing issues? If you want your innovative school to draw customers, you have to get accredited--not to mention dealing with the fact that your competition gets public funds and you do not. Your innovative health care delivery process will run afoul of medical license and practice laws.
Dave Altig finds something curious in the unemployment numbers, with good graphs:
The disconnect between the supply of and demand for workers that is reflected in statistics such as the unemployment rate, the hiring rate, and the layoff rate can be dynamically expressed by the Beveridge curve. Named after British economist William Beveridge, the curve is a graphical representation of the relationship between unemployment (from the BLS's household survey) and job vacancies, reflected here through the JOLTS."
Since the second quarter of last year, the unemployment rate has far exceeded the level that would be predicted by the average correlation between unemployment and job vacancies over the past decade. Tuesday's report indicates that the anomaly only deepened in the first two months of the second quarter.
Arnold Kling makes the claim that individuals in the US have lost their voice over the past several decades. He makes some good points.
... there will be need for actions which are bad in themselves, and which all those still influenced by traditional morals will be reluctant to perform, the readiness to do bad things becomes a path to promotion and power. The positions in a totalitarian society in which it is necessary to practice cruelty and intimidation, deliberate deception and spying, are numerous. ... Yet it is through positions like these that the road to the highest positions in the totalitarian state leads.
Arnold Kling summarizes his "recalculation story" of which I am a big fan.
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