EconoMonitor

Economics Blog Aggregator

    United States

  • Marginal REVOLUTION

    Always gamble on an empty stomach?

    So says one new paper on PubMed, by de Ridder D, Kroese F, Adriaanse M, Evers C.: Three experimental studies examined the counterintuitive hypothesis that hunger improves strategic decision making, arguing that people in a hot state are better able to make favorable decisions involving uncertain outcomes. Studies 1 and 2 demonstrated that participants with more hunger or greater appetite made more advantageous choices in the Iowa Gambling Task compared to sated participants or participants with a smaller appetite. Study 3 revealed that hungry participants were better able to appreciate future big rewards in a delay discounting task; and that, in spite of their perception of increased rewarding value of both food and monetary objects, hungry participants were not more in...more

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  • Brad DeLong's Grasping Reality...

    Liveblogging World War II: October 25, 1944: WHERE OH WHERE IS TASK FORCE 34?

    James D. Hornfischer: The Last Stand of the Tin Can Sailors: At 6:35 A.M., as sunrise revealed a grayed-out and hazy dawn, the most powerful concentration of naval gun power the Japanese empire had ever assembled reordered its geometry in preparation for daylight operations. Twenty-five miles to Taffy 3’s north, lookouts on the heavy cruiser Chokai and light cruiser Noshiro reported aircraft approaching. So Halsey’s planes were coming after all, Takeo Kurita must have thought. Almost simultaneously, cat-eyed lookouts on the battleship Nagato spied masts on the horizon visible here and there through the rainsqualls that dropped down from the heavens like gauzy shrouds. An eight-knot easterly wind roused low swells from the sea. From the Yamato’s gunnery platfor...more

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  • ProfessorBainbridge.com

    Tomorrow is St Crispin's Day

    Yearly, on the vigil: [[ This is a content summary only. Visit my website for full links, other content, and more! ]]

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  • ProfessorBainbridge.com

    Johnson et al offer "Comments on the HHS' Flawed Post-Hobby Lobby Rules"

    Lyman Johnson organized a group of law professors including yours truly to provide comments to HHS on its rulemaking to implement the Supreme Court's Hobby Lobby decision. Lyman put together a very... [[ This is a content summary only. Visit my website for full links, other content, and more! ]] ...more

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  • Calculated Risk

    Merrill Lynch: FOMC Preview

    From Merrill Lynch: The October FOMC meeting is likely to see the end of QE3 buying, as the Fed tapers the final $15bn in asset purchases. ... Tapering has been largely contingent on an improving labor market, and that has generally continued. The FOMC also has indicated multiple times that they are likely to end QE3 in October. Thus, it would take a significant adverse shock to change that plan, in our view.As for the statement language, we expect the “significant underutilization” language to once again remain in place — although we see a modest chance that is downgraded, say to “elevated underutilization.” Meanwhile, the likelihood of changing the “considerable time” language is much more evenly split. Our base case remains no change in October, largely...more

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  • ProfessorBainbridge.com

    McDonnell on "The Liberal Case for Hobby Lobby"

    Brett McDonnell has posted The Liberal Case for Hobby Lobby (October 22, 2014), available at SSRN: http://ssrn.com/abstract=2513380: The recent Supreme Court decision in Burwell v. Hobby Lobby... [[ This is a content summary only. Visit my website for full links, other content, and more! ]] ...more

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  • Calculated Risk

    Bank Failure #16 in 2014: National Republic Bank of Chicago

    From the FDIC: State Bank of Texas, Dallas, Texas, Assumes All of the Deposits of the National Republic Bank of Chicago, Chicago, IllinoisAs of June 30, 2014, The National Republic Bank of Chicago had approximately $954.4 million in total assets and $915.3 million in total deposits. ... The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $111.6 million. ... The National Republic Bank of Chicago is the 16th FDIC-insured institution to fail in the nation this year, and the fifth in Illinois. Bank failure friday two weeks in a row! ...more

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  • All HW content

    Safeguard Properties strengthens IT management with two promotions

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  • All HW content

    Invitation Homes bringing another REO-to-rental securitization to market

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  • Brad DeLong's Grasping Reality...

    Jeff Madrick, Josh Bivens, Brad DeLong, Ylan Mui: How Mainstream Economic Thinking Imperils America

    EPI: How Mainstream Economic Thinking Imperils America: "

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  • Brad DeLong's Grasping Reality...

    Ted Cruz’s Deputy Chief Nick Muzin Blamed Ebola on Obamacare. Really

    Chris Caesar: Ted Cruz’s Deputy Chief Blamed Ebola on Obamacare. Really

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  • All HW content

    Ocwen’s bad week just got worse

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  • The Big Picture

    Succinct Summations of Weeks Events 10.24.14

    Succinct Summations week ending October 24th Positives: 1. S&P 500 rose ~ 4% for the week — amazingly is now down less than 1% for the month. 2. Initial jobless claims came in slightly higher than expected but the 4-week moving average fell to the lowest levels since 2000. 3. Mortgage refinance applications rose 23.3% w/o/w as 30-year mortgage rates fell to their lowest levels since May 2013. 4. Consumer prices, bot headline and core rose 0.1% vs flat estimates. 5. Existing home sales came in at 5.17mm, the highest since September 2013. 6. New home sales rose to 467k, the most since ’08. 7. Japanese manufacturing PMI rose to 52.8, a 7-month high. Negatives: 1. Despite the lowest 30-year loan rates in over a year, mortgage applications fell 4.8% w/o/w. 2. New...more

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  • Calculated Risk

    Lawler on New Home Sales: Silly-Looking August Guess Revised Down Sharply in the West – As Expected

    From housing economist Tom Lawler:Census “guesstimated” that new SF home sales ran at a seasonally adjusted annual rate of 467,000 in September, up 0.2% from August’s downwardly-revised (by 7.5% to 466,000) pace. Sales estimates for June and July were also revised downward (by 2.4% and 5.4%, respectively). Not surprisingly (see LEHC, 9/24/2014), the biggest downward revision in sales for August was in the West region, where sales were revised downward by almost 20%.Census also estimated that the inventory of new SF homes for sale at the end of September was 207,000 on a seasonally adjusted basis, up 1.5% from August’s upwardly revised (to 204,000 from 203,000) level and up 13.1% from a year ago. Census estimated that the median new SF home sales price last mo...more

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  • Cafe Hayek - Article Feed

    More Than One Perspective

    (Don Boudreaux) Here’s another letter to my new correspondent from New Jersey: Dear Mr. Sloan: I appreciate your correspondence.  Thank you for it. You ask if I agree that, because successful entrepreneurs “such as [Jeff] Bezos … benefit disproportionately” from government-supplied infrastructure, these entrepreneurs should be taxed at rates higher than those levied on “regular people.” I don’t agree.  My reasons are many, not the least of which is that I doubt that successful entrepreneurs benefit disproportionately from government-supplied infrastructure.  Looking at the non-farm U.S. economy over the years 1948-2001, Yale economist William Nordhaus calculates that successful innovators capture only about two percent of the value to society of...more

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  • Economist's View

    'What Path for Development in Africa -- and Elsewhere?'

    Tim Taylor: What Path for Development in Africa -- and Elsewhere?: As I've pointed out from time to time, the countries of  sub-Saharan Africa have been experiencing genuine conomic growth for the last decade or so, and not just in oil- and mineral-exporting countries, creating what is by the standards of developing economies an expanding middle class. But here comes Dani Rodrik to ask some realistic tough questions in his essay, "Why an African Growth Miracle Is Unlikely," written for the Fourth Quarter 2014 issue of the Milken Institute Review. Rodrik also argues this case in "An African Growth Miracle?" given as the Richard Sabot lecture last April at the Center for Global Development. As Rodrik readily acknowledges, many nations of ...more

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  • naked capitalism

    2:00PM Water Cooler 10/24/14

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  • Marginal REVOLUTION

    Ebola markets in everything

    Ebola plush toys have been selling so fast in response to this year’s outbreak that a Connecticut manufacturer, Giantmicrobes Inc., can’t keep them in stock. The company, which was founded a decade ago, makes stuffed toys based on the appearance of microbes like Ebola, Chicken pox, bed bugs, and even non-harmful microscopic organisms things like brain and red blood cells. The items are meant to be educational tools for young children, Laura Sullivan, vice president of operations, told CBS News. There is more here, and for the pointer I thank James Lynch.  Via Tim Harford, here is GiveWell on whether you should donate to Ebola response causes.  Here is how Nigeria and Senegal beat back Ebola, let’s hope we can do the same.  It is a good example of ho...more

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  • The Big Picture

    How Many Ebola Patients Have Been Treated Outside Africa?

    Source: NY Times Source: NY Times

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  • Economist's View

    Market Power, 'the Profits-Investment Disconnect,' and the Mal-Distribution of Income

    Maybe we'll finally start discussing something I've been writing about for years with little traction, how market power affects the distribution of income (the disconnect between income and the contribution to final product that occurs when market power exists): The Profits-Investment Disconnect, by Paul Krugman: I caught a bit of CNBC in the locker room this morning, and they were talking about stock buybacks. Oddly — or maybe not that oddly, given my own experiences with the show — nobody brought up what I would have thought was the obvious question. Profits are very high, so why are companies concluding that they should return cash to stockholders rather than use it to expand their businesses? After all, we normally think of high profits as a signal: a p...more

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  • Economist's View

    'Redistribution Between Generations'

    Simon Wren-Lewis: Redistribution between generations: I ought to start a series on common macroeconomic misunderstandings. (I do not watch zombie films.) ... Here is one that crops up fairly regularly - that government debt does not involve redistribution between generations. The misunderstanding here is obvious once you see that generations overlap. ......more

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  • Dr. Housing Bubble Blog

    The myth of buying a home and staying put: Tiny home in Pasadena reaching peak prices as square footage decreases.

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  • Marginal REVOLUTION

    Assorted links

    1. Where is the missing right of center media? 2. There is no great stagnation (juvenile, skip it). 3. Unemployment and the minimum wage in China. 4. Do hedge funds get there first? 5. Did Thor Heyerdahl have a point after all? 6. Why not make your car a cathedral? 7. Ferns. ...more

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  • Paul Krugman

    The Profits-Investment Disconnect

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  • Paul Krugman

    The Invisible Moderate

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  • Econbrowser

    Guest Contribution: Is the US Current Account Deficit Problem Over?

    Today we are fortunate to have a guest contribution written by Jeffrey Frankel, Harpel Professor of Capital Formation and Growth at Harvard University, and former Member of the Council of Economic Advisers, 1997-99. The latest World Economic Outlook, released this month by the International Monetary Fund, warns that even though global “flow imbalances” are lower than a few years ago, they are still substantial and so US liabilities to foreigners continue to rise each year. “Stock imbalances” remain a problem. Figure 4.1 from Chapter 4, World Economic Outlook, October 2014. The US current account went into deficit in 1982. Thirty years ago, the US Council of Economic Advisers accurately predicted record current account deficits to come and at...more

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  • naked capitalism

    Class Traitors: How Ideological Brainwashing Gets Rich and Ordinary Americans to Undermine Their Economic Interest

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  • The Big Picture

    Bankers Learned All the Wrong Lessons From the Financial Crisis

    Under normal circumstances, approving my mortgage application should be a no-brainer: High income, no debt, high credit score. The missus also makes a good income, has an almost-perfect credit score and has been working for the same business for 28 years. But these are not normal circumstances. Let me jump to the end: Yes, we got our mortgage. We put 20 percent down, bought a house that appraised for more than the purchase price and got a 3.25 percent rate on a mortgage that resets after seven years. We moved in last month. But the process was surreal. Indeed, it was such a bizarre experience that I started hunting for explanations from people in the industry about why mortgage lending has gone astray. I spoke to numerous experts, many of whom spoke only on background. ...more

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  • Beat the Press

    The Ebola Vaccine: How Drugs Can Be Developed Without Patents

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  • Cafe Hayek - Article Feed

    Quotation of the Day…

    (Don Boudreaux) … is from the final paragraph of F.A. Hayek’s brilliant and profoundly important December 11, 1974 Nobel Prize lecture, “The Pretense of Knowledge“: There is danger in the exuberant feeling of ever growing power which the advance of the physical sciences has engendered and which tempts man to try, ‘dizzy with success’, to use a characteristic phrase of early communism, to subject not only our natural but also our human environment to the control of a human will.  The recognition of the insuperable limits to his knowledge ought indeed to teach the student of society a lesson in humility which should guard him against becoming an accomplice in men’s final striving to control society – a striving which makes ...more

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  • naked capitalism

    Links 10/24/14

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  • The Housing Bubble Blog

    For Every Reckless Borrower There Is A Greedy Investor

    It’s Friday desk clearing time for this blogger. “Markets that were hottest during the recovery saw the largest slowdown in home-value growth in the third quarter, Zillow said. The Bay Area definitely makes that list. The news gets even worse for Bay Area homeowners. Zillow expects year-ahead home-value appreciation in the Bay Area to grow just 2.9 percent, not even meeting the company’s national projection of 3 percent. Third-quarter inventory of Bay Area homes on the market jumped 20.2 percent from a year ago. Homeowners are likely to feel the chill as more people decide to sell before the slowdown turns into price cuts. It’s too late, Zillow says, noting that 37 percent of listings on its site nationally had at least one price cut in the past ...more

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  • Beat the Press

    The Banking Industry Wins On Risk Retention With Mortgages

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  • Beat the Press

    David Brooks' Great Adventures in Fantasy Land

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  • The Housing Bubble Blog

    Bits Bucket for October 24, 2014

    Post off-topic ideas, links, and Craigslist finds here.

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  • The Capital Spectator

    US Equity Sectors Review | 24 Oct 2014

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  • The Capital Spectator

    Initial Guidance | 24 October 2014

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  • Greg Mankiw's Blog

    Profile of an Ec 10 Student

    An amazing story, from the NY Times.

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  • Rick Bookstaber

    Ex Ante versus Ex Post Social Policy

    I have written various posts on social policy related to the question of whether and how we redistribute income. One argument of equal opportunity and social egalitarianism is that it is fair to control for the randomness of life. For example, take the luck of the draw in who your parents are. If your best career choice was to be born into a wealthy family, if you got ahead because your father could pull strings to get you an internship at a big investment bank; because you built up your high school resume by spending a summer building houses in Tibet while a classmate had to spend the summer working at the 7-11; or because you could afford two years of one-on-one tutoring for the SAT, the result might be to score higher in an objective standard of selection and have a ...more

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  • Cafe Hayek - Article Feed

    A Lesson from 1871 and 1874

    (Don Boudreaux) Here’s a letter to a student in New Jersey: Dear Mr. Sloan: Thanks for your latest note.  You remember correctly that I agree that Pres. Obama’s “You didn’t build that!” quip referred to infrastructure and other inputs – admittedly produced by others – that each entrepreneur relies on.  You’re mistaken, however, to insist that “because government makes businesses’ profits possible, even the most innovative” entrepreneurs and investors “earn only a portion of their profits.” You confuse possibilities with actualities.  Infrastructure and other inputs do not turn themselves into valuable outputs.  That task requires entrepreneurial creativity, risk-taking, and effort.  The very existence of huge profits earned in markets...more

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  • The Capital Spectator

    3 US Updates Show Ongoing Growth

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  • Econbrowser

    Philadelphia Fed Coincident Indices: Kansas and Wisconsin Continue to Lag Nation

    Low ranked by ALEC-Laffer, California and Minnesota continue to power along, as shown in data released today by the Philadelphia Fed. Figure 1: Log coincident indices for Minnesota (blue), Wisconsin (bold red), Kansas (green), California (teal), United States (black), seasonally adjusted, all normalized to 2011M01=0. Source: Philadelphia Fed and author’s calculations. Another way of visualizing the data is to show the cumulative growth relative to that of the United States. This is shown in Figure 2. Figure 2: Log coincident indices for Minnesota (blue), Wisconsin (bold red), Kansas (green), California (teal), seasonally adjusted, all expressed relative to that of the United States and normalized to 2011M01=0. Source: Philadelphia Fed and author’s calcula...more

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  • The Housing Bubble Blog

    The Essence Of The Housing Industrial Complex

    Some housing bubble news from Wall Street and Washington. The Washington Post. “The agency that oversees Fannie Mae and Freddie Mac said this week that it might soon lower the downpayment requirements from five percent to three percent for loans backed by the two firms. The Federal Housing Administration, a popular source of low downpayment loans, may soon consider lowering the fees it charges borrowers on the loans it insures. The nation’s top housing official, Housing and Urban Development Secretary Julian Castro, recently said it’s time to ‘remove the stigma’ tied to promoting homeownership. Castro said boosting the homeownership rate is at the top of his agenda.” “The nation’s home ownership rate jumped, from 43.6 percent in 1940 ...more

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  • Robert Reich

    Berkeley vs. Big Soda I got a call the other day from a stooge...

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  • Econbrowser

    Has Wisconsin Employment Growth Really Been Normal over the Last Four Years?

    Integration, cointegration and the evaluation of time series data for public policy analysis. As my first economics teacher said, “ya gotta be careful”. Bruce Thompson at Urban Milwaukee’s Data Wonk writes: …the data shows Gov. Walker has had little impact, positive or negative, on how the state grows jobs. Dr. Thompson appeals to data (which is good and a vast improvement over a lot of commentary), and focuses on the ratio of Wisconsin to national nonfarm payroll (NFP) employment (the documentation is unclear, but my graph using NFP looks the same as his, so I’ll assume it’s the establishment series and not the household series he’s using). He then shows that a linear regression on the ratio over the Doyle years predicts well ...more

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  • Fabius Maximus

    The truth emerges about Afghanistan, an indictment of our war. Now comes the hard part: learning from failure.

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  • Dr. Housing Bubble Blog

    Time to make it easier for people to get loans with lower credit and lower down payments: FHFA looking seriously at making it easier for cash strapped Americans to take on mortgages.

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  • Paul Krugman

    Fly the Derpy Skies

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  • Fabius Maximus

    We awake from fears of an Ebola pandemic in America. Now let’s ask who’s responsible…

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  • Robert Reich

    Getting a Grip on Ebola

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  • macroblog

    What's behind Declining Labor Force Participation? Test Your Hypothesis with Our New Data Tool

    .citation { font-style: italic; } .byline { font-style: italic; } .centeredImage { display: block !important; margin-left: auto !important; margin-right: auto !important; } The share of people (age 16 and over) participating in the labor market—that is, either working or looking for work—declined significantly during the recession. As many researchers have noted (see our list of supplemental reading under "More Information"), there is clearly a cyclical component to the decline. When labor market opportunities dry up, it influences decisions to pursue activities other than work, such as schooling, taking care of family, or retiring. However, much of the decrease in the overall labor force participation rate (LFPR) could be the result of the...more

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  • Fabius Maximus

    DoD shows its strength, mobilizing to protect us from Ebola (a sad story about America).

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  • Greg Mankiw's Blog

    Charles Murray on Ayn Rand

    A great and balanced essay.  Thanks to Alex Tabarrok for the pointer.

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  • Dr. Housing Bubble Blog

    Rental fury: The trend for renting continues to grow stronger. Housing starts jump largely on the back of multi-family housing starts.

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  • Paper Economy - A US Real Estate Bubble Blog

    New Residential Construction Report: September 2014

    Today’s New Residential Construction Report showed mixed results with total permit activity and total start activity improving while single family permit activity declined since August.Single family housing permits, the most leading of indicators, declined 0.5% from August to 624K single family units (SAAR), but increased 1.1% above the level seen in September 2013 and still remained well below levels seen at the peak in September 2005. ...more

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  • The Baseline Scenario

    No, You Can’t Get a Drink at 5 AM

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  • Rick Bookstaber

    My Recent Work on Agent-based Modeling

    As is obvious by looking at the time span between recent posts, I have not been active in blogging. I am planning to get back into things.  As a start, to help catch up on what I have been doing, here are a couple of papers and a presentation I recently made on the area of my focus, using agent-based modeling to help assess financial vulnerabilities.The model is presented here.For a concise presentation on the model and its application you can look at a talk I did in August at the Newton Institute for Mathematical Sciences at Cambridge University.  (Despite what is suggested by the venue, I did the presentation mathlessly).Related to the model is work I have been doing to develop a map of sorts for the key agents in the financial system and the ways in wh...more

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  • Greg Mankiw's Blog

    Head Section Leader in Ec 10

    Love teaching introductory economics?  Want to live in the Boston area?  Well, then, I have a job for you.

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  • Paper Economy - A US Real Estate Bubble Blog

    Retail Sales: September 2014

    Today, the U.S. Census Bureau released its latest nominal read of retail sales showing mixed results in September with sales dropping 0.3% from August but rising 4.3% on a year-over-year basis on an aggregate of all items including food, fuel and healthcare services. Nominal "discretionary" retail sales including home furnishings, home garden and building materials, consumer electronics and department store sales declined slightly, falling 0.14% from August but rising 2.16% above the level seen in September 2013 while, adjusting for inflation, “real” discretionary retail sales declined 0.38% on the month but rising 0.33% since September 2013. ...more

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  • Dani Rodrik's weblog

    Services, manufacturing, and new growth strategies

    I gave a talk yesterday on New Growth Strategies at the World Bank, which was more or less an elaboration of this short piece. I argued that industrialization had pretty much run out of steam as a growth strategy, that services would need to be the focus going forward, and that this required in turn a different policy mindset about how to increase productivity. In particular, I argued that policies focusing on generating a sequence of sectoral “winners,” which worked so  well in manufacturing (garments to car seats to cars to electronics), would have much smaller payoff in services, in view of the non-tradability of most service segments. I suggested further that, even under the best of circumstances, a services-oriented strategy would yield lower growth than ...more

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  • Paper Economy - A US Real Estate Bubble Blog

    Reading Rates: MBA Application Survey – October 15 2014

    The Mortgage Bankers Association (MBA) publishes the results of a weekly applications survey that covers roughly 50 percent of all residential mortgage originations and tracks the average interest rate for 30 year and 15 year fixed rate mortgages as well as the volume of both purchase and refinance applications. The purchase application index has been highlighted as a particularly important data series as it very broadly captures the demand side of residential real estate for both new and existing home purchases. The latest data is showing that the average rate for a 30 year fixed rate mortgage (from FHA and conforming GSE data) decreased 9 basis points to 4.08% since last week while the purchase application volume decreased 1% and the refinance application volume ...more

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  • Robert Reich

    Why Government Spends More Per Pupil at Elite Private Universities than at Public Universities

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  • Tim Duy's Fed Watch

    The Methodical Fed

    Just a few months ago the specter of inflation dominated Wall Street. Now the tables have turned and low inflation is again the worry du jour as a deflationary wave propagates from the rest of the world - think Europe, China, oil prices. How quickly sentiment changes. And given how quickly sentiment changes, I am loath to make any predictions on the implications for Fed policy. The very earliest one could even imagine a possible rate hike would be March of next year, still five months away. But since that month is the preference of Fed hawks, better to think that the earliest is the June meeting, still eight months away. Eight months is a long time.  We could pass through two more of these sentiment cycles between now and then.  Or maybe the story breaks decisively o...more

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  • Piggington's Econo-Almanac

    September 2014 Housing Data Rodeo

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  • The Baseline Scenario

    Cultural Capture and the Financial Crisis

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  • Tim Duy's Fed Watch

    The Labor Market Conditions Index: Use With Care

    I was curious to see how the press would report on the Federal Reserve Board's new Labor Market Conditions Index.  My prior was that the reporting should be confusing at best.  My favorite so far is from Reuters, via the WSJ: Fed Chairwoman Janet Yellen has cited the new index as a broader gauge of employment conditions than the unemployment rate, which has fallen faster than expected in recent months. The index’s slowdown over the summer could bolster the argument that the Fed should be patient in watching the economy improve before raising rates. But its pickup last month could strengthen the case that the labor market is tightening fast and officials should consider raising rates sooner than widely expected. Many investors anticipate the Fed will make its ...more

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  • Jeffrey Frankel's Blog

    The Return of Voodoo Economics

    Paul Krugman’s column in the New York Times today talked of the revival of “Voodoo economics” by some Republican politicians.  This refers to the Laffer Proposition that a cut in income tax rates stimulates economic activity so much that tax revenue goes up rather than down.   Gov. Sam Brownback, who is running for re-election in Kansas, has had to confront the reality that tax revenues went down, not up as he argued they would, when he cut state tax rates. I disagree with one thing that Krugman wrote in his column: the idea that there was a long break,  particularly after George W. Bush took office, during which Republican politicians did not push this line.  To the contrary, I have collected many quotes from George W. Bush and his top officials claiming the...more

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  • Tim Duy's Fed Watch

    Is There a Wage Growth Puzzle?

    Is there a wage growth puzzle?  Justin Wolfers says there is, and uses this picture:   to claim: This puzzle isn’t entirely new, as the usual link between unemployment and the rate of wage growth has totally broken down over recent years. ​The recent data have made a sharp departure from the usual textbook analysis in which a tighter labor market leads to faster wage growth, and subsequent cost pressures feed through to higher inflation. But has the link between wage growth and unemployment "totally broken down"? Eyeball econometrics alone suggests reason to be cautious with this claim as the only deviation from the typical unemployment/wage growth relationship is the "swirlogram" of fairly high wage growth relative to unemployment through the end of 2011 or s...more

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  • The Baseline Scenario

    Game of Thrones, The Wire, and the New York Fed

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  • macroblog

    On Bogs and Dots

    Consider this scenario. You travel out of town to meet up with an old friend. Your hotel is walking distance to the appointed meeting place, across a large grassy field with which you are unfamiliar. With good conditions, the walk is about 30 minutes but, to you, the quality of the terrain is not so certain. Though nobody seems to be able to tell you for sure, you believe that there is a 50-50 chance that the field is a bog, intermittently dotted with somewhat treacherous swampy traps. Though you believe you can reach your destination in about 30 minutes, the better part of wisdom is to go it slow. You accordingly allot double the time for traversing the field to your destination. During your travels, of course, you will learn something about the nature of the field, a...more

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  • Richard's Real Estate and Urban Economics Blog

    How the price of a Martini reveals the property value of a city

    A Hendricks Gibson is basically a commodity (although the bartender does need to know what she is doing). But a good Gibson at the Starlight Lounge in LaCrosse, Wisconsin is $8; at the Roof Garden at the Peninsula Hotel in Beverly Hills is $16; at the King Cole Bar of the St. Regis Hotel in New York is $22. Let's say the cost of the cocktail, including labor, but exclusive of real estate, is $7. Then the implicit rent you are paying for sitting in a bar in LaCrosse is $1; in Beverly Hills on a rooftop is $9; and in NYC is $15. If one consults Zillow, one will find that this ratio of 1:9:15 for real estate in LaCrosse, BH and Manhattan is pretty close to the truth.One key thing--all these drinks are served in competitive markets--there is true thickness in bars in t...more

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  • Richard's Real Estate and Urban Economics Blog

    How Piketty's care with language can improve economics

    When I was a freshman in college, I read Fogel and Engerman's Time on the Cross.  I loathed the book, because it implicitly endorsed the idea that it is OK, "in the interested of science," to dehumanize those African-Americans that were placed in bondage by viewing them as capital (I loathed it for other reasons as well, but that is for another time.) It also contributed to the broad view currently within much of mainstream economics that it is (1) acceptable to treat human beings as objects, and (2) that it is embarrassing to embrace humanity.  I was embarrassed that the book helped Fogel ultimately won the Nobel Prize in economics.I thought of Fogel and Engerman again when a recent review in the Economist of Edward Bishop's The Half Has Never Been Told compl...more

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  • Macro and Other Market Musings

    The Love Affair Conservatives Should Be Having

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  • Jeffrey Frankel's Blog

    Piketty’s Fence

    Most of the reviews of Thomas Piketty’s book Capital in the Twenty-First Century have already been written.  But I thought it might be best to read it all the way through before offering my own thoughts on this book, which startlingly rose to the top of the best seller lists last April.  It has taken me five months, but I finished it. One of the things the book has in common with the Karl Marx’s Das Capital (1867) is that it serves as a rallying point for the many people who are passionately concerned about inequality, regardless whether they understand or agree with the specific arguments contained in the book in question.  To be fair, much of what Marx wrote was bizarre and very little was based on careful economic statistics.  Much of what Piketty says is ba...more

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  • Piggington's Econo-Almanac

    August 2014 Housing Data Rodeo

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  • macroblog

    The Changing State of States' Economies

    Timely data on the economic health of individual states recently came from the U.S. Bureau of Economic Analysis (BEA). The new quarterly state-level gross domestic product (GDP) series begins in 2005 and runs through the fourth quarter of 2013. The map below offers a look at how states have fared since 2005 relative to the economic performance of the nation as a whole. Learn About Tableau It’s interesting to see the map depict an uneven expansion between the second quarter of 2005 and the peak of the cycle in the fourth quarter of 2007. By the fourth quarter of 2008, most parts of the country were experiencing declines in GDP. The U.S. economy hit a trough during the second quarter of 2009, according to the National Bureau of Economic Research, but 20 states an...more

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  • Dani Rodrik's weblog

    Back to sanity on economic convergence

    It’s been interesting to watch how the conventional wisdom on rapid convergence – developing countries closing the gap with the advanced economies – has been changing over the last few years. It wasn’t so long ago that the world was in the grips of emerging-markets mania, projecting wildly optimistic growth numbers decades into the future. For the last 4-5 years, I have been writing that the pace of convergence we have experienced over the last two decades is unsustainable. There were temporary factors (cheap capital, low interest rates, high commodity prices, rapid Chinese expansion) which would begin to reverse themselves. And perhaps most importantly, export-oriented industrialization was running out of steam much earlier, even in the relatively successful co...more

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  • Macro and Other Market Musings

    Another Bond Market Conundrum?

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  • Macro and Other Market Musings

    About the Fed Not Trying Hard Enough To Hit Its Inflation Target

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  • Jeffrey Frankel's Blog

    Modi, Sisi & Jokowi: Three New Leaders Face the Challenge of Food & Fuel Subsidies

    In few policy areas does good economics seem to conflict so dramatically with good politics as in the practice of subsidies to food and energy.  Economics textbooks explain that these subsidies are lose-lose policies. In the political world that can sound like an ivory tower abstraction.   But the issue of unaffordable subsidies happens to be front and center politically now, in a number of places around the world.   Three major new leaders in particular are facing this challenge:  Sisi in Egypt, Jokowi in Indonesia, and Modi in India. The Egyptian leader is doing a much better job of facing up to the need to cut subsidies than one might have expected.  India’s new prime minister, by contrast, is doing worse than expected – even torpedoing a long-anticipated ...more

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  • Piggington's Econo-Almanac

    July 2014 Housing Data Rodeo

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  • Dani Rodrik's weblog

    My moonlighting career of the last 4 years

    At long last, Turkey's consitutional court has reversed the conviction of the more than 200 officers previously found guilty in the bogus Sledgehammer coup plot, leading to the release on June 19th of all those in jail (including my father in law). Even though a retrial is to take place, the ruling is a coda to the last four-and-a-half years during which my wife and I moonlighted as criminal investigator, forensic analyst, and political activist. It has been a truly surreal and bizarre experience, given how so many intelligent people bought into -- and refused let go of -- a coup plot that was patently fictitious.     So I thought this would be a good time to post a longish account of my involvement in the story. I wrote it as much to make sense of it to...more

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  • The Becker-Posner Blog

    Farewell

    In memoriam: Gary S. Becker, 1930-2014. The Becker-Posner blog is terminated. Richard A. Posner

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  • Rick Bookstaber

    Piketty Myopia

    Thomas Piketty's book Capital in the Twenty-First Century has been lauded for its detailed analysis of data and for the end result of that analysis, a sweeping statement of an inexorable widening of the distribution of wealth between those with capital and those without. There is unabashed glee among those who have bemoaned the plight of the middle class as the one percent has pulled away, waving the book as the gotcha ya for income redistribution.  As should be clear from some of my previous posts, I am one of those people bemoaning the plight, but I am a little slower than many others to take up the Piketty banner. The book's argument looks at wealth and growth data over the past three centuries, and takes its implications forward with a similar, historical scope...more

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  • The Becker-Posner Blog

    Sabbatical Notice

    Starting this weekend, we will be taking a one-month sabbatical from blogging. We will resume at the end of that period.

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  • The Becker-Posner Blog

    The Embargo of Cuba: Time to Go- Becker

    The US embargo of Cuba began in 1960, a year after Fidel Castro turned this island toward communism. It was extended to food and medicines in 1962, the same year as the showdown with Russia over the installation of missiles there. The embargo has prevented American companies from doing business with Cuba, and discouraged tourism to Cuba. The American government also tried with quite limited success to prevent other countries from trading with Cuba. In general economic embargoes are undesirable because they interfere with free trade among countries. Yet a case could be made for an embargo against Cuba. Castro not only allowed Russian missiles to be installed in Cuba, just 90 miles from Florida, but was also actively trying to interfere in other countries by sending troop...more

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  • Stan Collender's Capital Gains and Games

    Capital Gains And Games Now Being Published By Forbes

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  • Stan Collender's Capital Gains and Games

    Big Changes Are Coming To Capital Gains And Games

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  • Stan Collender's Capital Gains and Games

    Camp Plan Puts Nail In Tax Reform Coffin For This Year, And Next, And...

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  • Richard's Real Estate and Urban Economics Blog

    Hannah Harris Green in The Guardian on Race, Crime and Television

    She writes:The First 48 is an A&E true crime reality show that documents real police investigations for the first 48 hours after a homicide report, including what happens inside interrogation rooms. If this sounds dangerous and ethically questionable, that's because it is. Police accidentally killed a child as A&E's cameras rolled, and a legally innocent man came to beknown as a murderer after of his appearance on the show. Catastrophes like these have led to lawsuits, and now many cities refuse to work with The First 48.......This portrayal is not representative of American crime statistics. Although homicide arrests are disproportionately high among African Americans, about the same total number of white people are arrested i...more

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  • democracyarsenal.org

    Can the F-35 Replace the A-10?

    by Nickolai Sukharev  One of the big decisions the United States Air Force has considered over the last few months is whether to retire the A-10 Thunderbolt II fleet as a cost saving measure while developing and procuring the F-35A Lightening II. Given the Budget Control Act caps on Pentagon spending and the need to better allocate funds, officials have expressed their preference to prioritize multi-mission platforms in the inventory. But the problem is that the F-35A is not a replacement for the A-10’s close air support. The reason is simple: it lacks comparable capabilities despite a higher operating cost. Given the constrained budgetary environment, the comparative cost to maintain and operate the two aircraft should be a decisive consideration. The A-10 is a...more

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  • democracyarsenal.org

    After Geneva Talks A Consensus on Moving Forward

    By Homa Hassan The two-day round of P5+1 negotiations with Iran just concluded in Geneva and Western diplomats are carefully reviewing a detailed proposal presented by Iran. As this proposal is being reviewed ahead of the follow-on meetings in November it is important to look at what the realistic prospects of a deal will look like. Going into this week’s talks, a number of commentaries came out attempting to set negotiations up for failure. However, it is widely agreed that a negotiated solution to Iran’s controversial nuclear program is the best way to achieve a sustainable solution and a recent survey of reports and recommendations from bipartisan think tanks and high-level experts demonstrates a broad consensus on how to approach negotiations a...more

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  • democracyarsenal.org

    TPP, TTIP and Getting America's Competitiveness Back on Track

    By Marcela Heywood Last week’s Asia-Pacific Economic Cooperation summit in Bali, Indonesia marked further progress for the Trans-Pacific Partnership (TPP) and set an ambitious goal to finish negotiations by the end of the year. Although the U.S. government shutdown – and President Obama’s absence in Bali – did not hinder the trade talks, it did call America’s credibility into question. Government shutdown could threaten both TPP and Transatlantic Trade and Investment Partnership (TTIP) negotiations by displaying uncertainty in U.S. economic and foreign policy priorities. Congress needs to reach an agreement and prioritize TPP and TTIP, as they are necessary policy initiatives to boost American competitiveness, stimulate the economy, and exert soft power to cr...more

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  • Paul Kedrosky's Infectious Greed

    Twitter Digest: 2013-06-09

    Given that I block NSA & PRISM tweets, was entertaining tuning into twitter & trying to figure why everyone was on about Lord Snowdon -> Turned on GoT tonight just in time to catch Daenerys reenacting her Level 2 YMCA gymnastics pageant. -> How Not to Be Alone | Jonathan Safran Foer – http://t.co/HMFxg75lfh http://t.co/DzAtvWBQJr -> Excellent, but fellow sports-med geeks only: Sports and exercise-related tendinopathies: a review – http://t.co/WGkhRlO6Uz -> ...more

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  • Paul Kedrosky's Infectious Greed

    Twitter Digest: 2013-06-07

    Photo-set: Flooding Across Central Europe – http://t.co/8G6j8teCbd -> CDC Update: Severe Respiratory Illness Associated with Middle East Respiratory Syndrome Coronavirus – http://t.co/hWqN1338VN -> Col Flagg: Have you ever heard of Malaysian Chest Implosion Torture? Radar: No. Coll Flagg: Good. It hasn’t been invented… yet. -> tl;dr: There are Manchurian Candidate engineers at large tech cos that have stolen SSL root cert and NSA is using it for cattle mutilation. -> Brian: …Will you please listen? I'm not the Messiah! Do you understand? Honestly Woman: Only the true Messiah denies his divinity! -> ...more

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  • Paul Kedrosky's Infectious Greed

    Twitter Digest: 2013-06-05

    FRED: Free Energy Data – http://t.co/90H7GVDazO -> Solipsisms ‘r’ us, courtesy of my friends at @thinkup: I apparently mention me a lot – http://t.co/9rTRXvBM9D -> Almost 10,000 words on soccer/Italy/economics/racism by @wrightthompson? Yes, & it’s super. Go. http://t.co/g4sgEFLkIC -> When The Beautiful Game Turns Ugly: A journey into the world of Italy's racist soccer thugs http://t.co/nckrbeLPfs -> Can’t remember last time I read an OpEd or column. Do those still exist? -> ...more

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  • The Street Light

    Cyprus and Eurozone Bank Deposits

    To me, the central issue raised by this week's Cyprus debacle is how it has affected confidence across the eurozone.  To what degree has the possibility of insured depositors at a eurozone bank losing a portion of their deposits affected the mindset of depositors?  To what degree has ECB acquiescence to this possibility undermined the notion that deposit insurance in the eurozone means the same thing in all countries?  And to what degree has the ECB's direct threat to end support for Cyprus's banking system in the event that the government of Cyprus can not arrange sufficient funds to meet its conditions made a farce of its earlier promise to "do whatever it takes to preserve the euro"?These, to me, are the interesting questions prompted by this week's ev...more

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  • The Street Light

    When the Fed Chair is an Academic

    The big economic news of the week was, in fact, big economic news: the Fed's announcement of significant changes from past practice in the the quantity of its next round of large scale asset purchases ("unlimited"), and in the timing of any future reversal of this expansionary policy ("a considerable time after the economic recovery strengthens").I view this as a pretty fundamental shift in how the Fed hopes to affect the economy.  Rather than trying to push economic activity one way or the other through its management of interest rates (which can alter economic activity through its portfolio-rebalancing and wealth effects, for example), the Fed is now quite explicitly trying to affect economic activity by altering interest rate and inflation expectations.  As...more

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  • The Street Light

    Government Job Destruction

    Another jobs report in the US, another month where part of the private sector's job creation was undone by continued job destruction by the government sector. The 15,000 additional jobs lost in April brings total job losses in the government sector since January 2010 to over 500,000. While the US has not quite been experiencing European-style austerity over the past two years, that's still a pretty tough headwind to fight as it emerges from recession. ...more

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  • TPMCafe

    Message to world government: Don't govern the Internet

    You could think of the Aspen IDEA report published today as a letter to the head of the International Telecommunications Union, Hamadoun Touré, suggesting that he should reconsider his intent to put the "light touch" of government on the Internet's operations. M. Touré will be running a major meeting of world governments in Dubai at the end of this year. The Dubai meeting, known as WCIT 12, may have an agenda that is a light touch only if that's what you can call a grab for the jugular vein of the Internet. The issues may include a "per click" tax on international Internet traffic, individual nation state regulation identities to online activity, national encryption standards to allow government surveillance, and multinational governance of the Internet. Russia, Chi...more

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  • TPMCafe

    Obama and Romney on Foreign Policy - Drawing the Contrasts

    The political battle lines are being drawn for the general election debate over foreign policy and national security, and you can't do much better than my fellow Democracy Arsenal blogger Michael Cohen for a guide. One key theme of Michael's latest column for ForeignPolicy.com is what a difference it makes for a candidate to bear the responsibility of governing, or on the other hand, campaign to be commander in chief on the basis of self-serving pot shots. My only quibble regards how Romney's reed-thin foreign policy argument will fare with voters. Take Michael's analysis of Romney's potential advantage in the debate on Iran: He can simply lob rhetorical haymakers that hype up the threat of an Iranian bomb or offer Churchillian declarations about his intention to stop...more

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  • TPMCafe

    Will Yale's Alumni Save Liberal Education?

    Hoping to head off alumni resistance to the brand-new "Yale-National University of Singapore" college that the Yale Corporation has created somewhat stealthily in collaboration with the government of that authoritarian city-state, Association of Yale Alumni chairman Michael Madison has inadvertently demonstrated one of the ways Yale College is being transformed from a crucible of civic-republican leadership, grounded in liberal education, into a global career-networking center and cultural galleria for a new elite that answers to no polity or moral code: STATEMENT OF THE OFFICERS OF THE AYA BOARD OF GOVERNORS, Michael Madison, Chair of the Board "All Yale-NUS College graduates will be warmly welcomed as a part of the Yale alumni community. They will also be invited...more

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Dan Steinbock

Dr Dan Steinbock is a recognized expert of the multipolar world. He focuses on international business, international relations, investment and risk among the major advanced economies (G7) and large emerging economies (BRICS and beyond).

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