Saturday, February 28, 2009
My degenerate horse race gambling buddies and I hit a 30-1 shot recently at Gulfstream Park in Florida. You can watch it below. The Horse's name is Warrior's Reward.
When the horse hit the wire, Marshall Gramm broke out and did the Riddler dance. The crazy goof had a fist full of winning tickets and he laughed himself silly like Frank Gorshin. Watch him...
Friday, February 27, 2009
Click on this link and then go to the bottom of the map of the US. Then drag the scrapper from left to right. You better sit down.
Senator Schumer asked Chairman Bernanke the other day whether when the economy does recover will the recovery be a "V" or an "L"? In other words will recovery be a swift and quick return to trend growth or a protracted tepid growth path. Chairman Bernanke of course equivocated. I won't...it will be an "L" Senator...a real long long "L".
Thursday, February 26, 2009
The world has lost a great economist and one of its most wonderful human inhabitants. It is with deep regret that I must report Victor Zarnowitz has died. He was one of the kindest men I have ever known and he did many wonderful things for me over the years. He is in my first book and wrote the Foreword for my second book. He always took my calls when I wanted to discuss the business cycle with him. His whole family was destroyed by the Nazis in World War II. He grew up in Auschwitz as a child. He fled when the war broke out but stayed in a Russian labor camp for 19 months. He uplifted me spiritually whenever I remembered what he lived through and triumphed over. Victor Zarnowitz made this world a much better place. I gave him the nick name "Mr. Business Cycle." He will be deeply missed.
Here is my interview with him from 1997. This interview still moves me.
Whether you are Roosevelt with the National Recovery Act and the National Industrial Recovery Administration or you are Obama and talk about cap and trade, card check, health care and comparable worth ... the result is the same ... even if we bottom out soon, the recovery will be long and protracted as these policies throttle efforts at resuscitation. These things can only be viable with a vibrantly growing economy. That is not today.
Wednesday, February 25, 2009
My colleague Phil Rothman and I are increasingly of the opinion that Ricardo Cabellero has an intellectual handle on what needs to be done.
Venceremos! (Marxist mantra meaning "We will Triumph!")
Tuesday, February 24, 2009
Monday, February 23, 2009
Sunday, February 22, 2009
Don't look if you don't wanna see two stoops do themselves in.
By the way, why is it 72 virgins? Why not 39 or something a bit more manageable? I'd be happy with one dirty girl from Paris.
Saturday, February 21, 2009
Friday, February 20, 2009
So says Martin Wolf thus:
"The correct advice remains the one the US gave the Japanese and others during the 1990s: admit reality, restructure banks and, above all, slay zombie institutions at once. It is an important, but secondary, question whether the right answer is to create new “good banks”, leaving old bad banks to perish, as my colleague, Willem Buiter, recommends, or new “bad banks”, leaving cleansed old banks to survive. I also am inclined to the former, because the culture of the old banks seems so toxic."
From the Fed of San Franciso. If you ever have the chance to go to San Francisco, take it. It is a wonderful city...and the gateway to California's wine country.
Wednesday, February 18, 2009
Tuesday, February 17, 2009
"Give me your smartest, your brightest, your huddled, skilled workers and Ph.D. s yearning to create and produce."
Monday, February 16, 2009
The stimulus bill shows its slime....
Saturday, February 14, 2009
Thursday, February 12, 2009
What do you expect the Canadians to do, EH? I don't blame them, I blame us.
Wednesday, February 11, 2009
First it was Nancy in her own words. Now how about Robert in his own words? Time to choose your side.
Tuesday, February 10, 2009
Monday, February 9, 2009
Not even Marx himself said he wanted to "equalize" incomes.
" We need to work toward the goal of equalizing income in our country and at the same time limiting the amount the rich can invest." "We need to raise the standard of living of our poor, unemployed and minorities. For example, we have an estimated 12 million illegal immigrants in our country who need our help along with millions of unemployed minorities. Stock market windfall profits taxes could go a long way to guarantee these people the standard of living they would like to have as 'Americans'."
Sunday, February 8, 2009
Saturday, February 7, 2009
Once again, if you don't want to see Joe Jihadi have a bad day, then log off and we will see you tomorrow. By the way, do dum-dums still get 72 virgins?
Friday, February 6, 2009
Thursday, February 5, 2009
Wednesday, February 4, 2009
Tuesday, February 3, 2009
Monday, February 2, 2009
Economists and former Bank of Japan officials say the biggest lesson they learned was that cutting rates alone has almost no effect when the financial system has fallen into a crisis as deep as the one Japan faced in the 1990s.
Japanese banks simply refused to lend in an environment where borrowers could suddenly go bankrupt, saddling lenders with huge, unforeseen losses. The Bank of Japan tried even more extreme measures, like using its powers to create money to essentially stuff cash into the nation’s commercial banks in hopes they would start lending again.
Exasperated central bankers found that commercial banks just let the money pile up instead of lending it out.
Economists say the United States faces a similar situation, after the sudden collapse in September of Lehman Brothers created fears of additional failures. Economists also fault Washington for its inconsistency in dealing with the financial crisis, leaving the impression that it does not have a clear strategy for dealing with ailing lenders.
In Japan’s case, economists and former bankers say, credit began to flow freely again only after 2003, when regulators adopted a tough new policy of auditing banks and forcing weaker ones to raise new capital or accept a government takeover. Economists said the audits finally removed paralysis in credit markets by convincing bankers and investors that sudden failures were no longer a risk, and that the true extent of problems at banks and other companies was finally being revealed.
Economists say Washington needs to do something similar to make banks and financial companies more transparent, and reassure investors that there were no more collapses like that of Lehman Brothers on the horizon.
“The United States needs to do it like Takenaka did,” said Anil Kashyap, a professor of business at the University of Chicago, referring to Heizo Takenaka, the former banking minister who started the 2003 audits. “We need someone to come in and give a good housekeeping seal to banks.”
Economists and former central bankers said another lesson from Japan’s experience was the importance of consistency. This became apparent in 2000, they said, during one of the bank’s more embarrassing episodes, when it raised interest rates, and lowered them back to zero a year later when the economy faltered.
Former Bank of Japan officials said they learned that bankers and investors would lend in difficult times only if they believed that rates would stay low for a long period, ensuring them adequate profits. By raising the possibility of future interest rate increases, the Bank of Japan dampened enthusiasm for lending, say bankers and economists.
“We learned that zero rates work by building expectations,” said Rei Masunaga, an economist and former director general at the Bank of Japan. “Zero interest rates take time to be effective.”