Now You, too, Can Pontificate About What's Driving Today's Markets Like Paul Krugman!
Jason Kusnicki Tears Michael Kinsley on Ben Carson to Shreds and Gobbets, and then Eats the Gobbets: Thursday Whiskey-Tango-Foxtrot Weblogging

Noted for May 30, 2013

Owen Zidar sends us to Reed Walker: >The Transitional Costs of Sectoral Reallocation: Evidence From the Clean Air Act and the Workforce | Bill Davidow: The Internet 'Narcissism Epidemic' | William G. Bowen: The ‘Cost Disease’ in Higher Education: Is Technology the Answer? | Brad DeLong (March 20, 2008): The Liquidity Trap Cometh... | Central Banks Act With a New Boldness | Margot Sanger-Katz: Wal-Mart’s Super-Counterintuitive Health Care Plan: Instead of skimping on the most expensive care, the giant retailer is sending its workers to top-tier hospitals. Turns out, it’s a great way to save money | Donald Taylor: Parsing the details of catastrophic health plans | Josh Bivens: No cause for relief—austerity will indeed drag hard on the economy in 2013 and 2014 | Aaron Carroll: Opinion: Myths about Obamacare |

  • Ezra Klein: No one really believes in ‘equality of opportunity’: "Avik Roy writes that everyone is missing the point of the conservative reformers. The changes aren’t happening, or aren’t mainly happening, at the level of policy. They’re happening at the level of principle. 'Where many reformers differ from their ancestors is in the philosophical source of their support for free markets…. Older, libertarian-flecked strain of American economic conservatism appreciates liberty as an end in itself… today’s conservative reformers [see] equality of opportunity — especially for the poor — [as] the highest moral and political priority'…. Everyone in American life professes to believe in equality of opportunity. But nobody really believes in it…. You can’t have real equality of opportunity without equality of outcome. A rich parent can purchase test prep a poor parent can’t. A rich parent can usher their children into social networks a poor parent can’t. A rich parent can make donations to Harvard that a poor parent can’t…. When people say they believe in 'equality of opportunity', they really mean they believe in 'sufficiency of opportunity'…. Democrats who believe in sufficiency of opportunity tend to want to spend more on health care and education for the poor…. On the Republican side, Rep. Paul Ryan (Wis.) has taken the lead in arguing that conservatives should focus on opportunity. But his approach largely consists of cuts to the safety net… the poor are held back by the government spending too much money to cover the uninsured and too much money on food stamps and too much money on education and too much money on childhood nutrition and too much money on daycare."

  • Paul Krugman "Matthew Yglesias… makes a point… if the real problem is that we overspent and lived beyond our means, we should be working harder, not throwing millions of people into unemployment. Yglesias makes his point with the case of Iceland, which has indeed restored relatively full employment while continuing to suffer somewhat reduced real income. But there’s an even better example from the historical record: Britain after World War II… responded to high levels of debt with an economy in which life was pretty hard for investors, luxuries were hard to come by even for the middle class, and everyone worked hard — but, you know, everyone had a job. We’ve responded to much lower levels of debt by ensuring that the economy functions far below potential, millions of people who want to work can’t find jobs, and many people see all their hopes for the future slipping away."

  • Pawel Morski: QE: Because Nobody’s Got Any Better Ideas: "I come not to bury QE, but to praise it. Or at least point out that it’s probably better than doing nothing, and that 'nothing' seems to be a pretty good description of the other politically-acceptable alternatives globally. First, let’s deal with the 'QE distorts prices and changes the behaviour of investors'. This is like complaining that 'cars carry people to different places'. It’s not an objection, it’s a description of the WHOLE DAMN POINT of the exercise. A case in point: the recovery of the housing market has been driven by investor demand. And it’s the big institutions – the WSJ link points to 20,000 homes snapped up by Blackstone. This is what happens when the search for income, driven out of Treasuries by low yields turns into activity. This is FoBOR at work (Forced Buyers Of Risk to use Dan Davies‘ term): 'High maintenance costs traditionally had kept investors out of managing hundreds of scattered-site rentals. But investors set about overcoming those hurdles two years ago because low interest rates engineered by the Federal Reserve generated “a tremendous appetite for yield,” said real-estate consultant John Burns, who advises investor firms. “It really sent capital chasing to figure out this business.”'"