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Rational Markets

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Reading the Employment Report: Focus on Hours, Not Heads - Freakonomics Blog - NYTimes.com:

"Any evidence of ‘green shoots’ appearing in recent months disappears in this broader measure. The recession continues apace. If current trends continue, we are in for a frightening time."

(Via Freakonomics Blog.)

Subprime Thinking

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Did Liberals Cause the Sub-Prime Crisis? | The American Prospect:

"It's telling that, amid all the recent recriminations, even lenders have not fingered CRA. That's because CRA didn't bring about the reckless lending at the heart of the crisis. Just as sub-prime lending was exploding, CRA was losing force and relevance. And the worst offenders, the independent mortgage companies, were never subject to CRA -- or any federal regulator. Law didn't make them lend. The profit motive did."

(Via The American Prospect.)

Wall Street and the Third World | vanityfair.com:

"The former Communist countries generally turned, after the dismal failure of their postwar system, to market capitalism, replacing Karl Marx with Milton Friedman as their god. The new religion has not served them well. Many countries may conclude not simply that unfettered capitalism, American-style, has failed but that the very concept of a market economy has failed, and is indeed unworkable under any circumstances. Old-style Communism won’t be back, but a variety of forms of excessive market intervention will return. And these will fail. The poor suffered under market fundamentalism—we had trickle-up economics, not trickle-down economics. But the poor will suffer again under these new regimes, which will not deliver growth. Without growth there cannot be sustainable poverty reduction. There has been no successful economy that has not relied heavily on markets. Poverty feeds disaffection. The inevitable downturns, hard to manage in any case, but especially so by governments brought to power on the basis of rage against American-style capitalism, will lead to more poverty. The con?sequences for global stability and American security are obvious."

(Via Vanity Fair.)

Great and succinct critique on market fundamentalism ("free markets can solve any problem").

Obama puts critics of financial overhaul on notice - Yahoo! News:

"'It will have the power to set tough new rules so that companies compete by offering innovative products that consumers actually want and actually understand,' Obama said. 'Those ridiculous contracts — pages of fine print that no one can figure out — will be a thing of the past. You'll be able to compare products, with descriptions in plain language, to see what is best for you.'"

(Via Yahoo! News.)

This is exactly what these companies don't want.

Krugman vs. Ferguson: Letting the Data Speak - Freakonomics Blog - NYTimes.com:

"In fact, the recent increase in Treasury yields is almost entirely due to a reduction in the probability of the deflationary (low nominal interest rates) scenario. Score this round for Krugman.

While Ferguson wrongly diagnosed the cause of the rise in interest rates, he is right that the markets are spooked about the risk of an inflationary breakout. There’s about a 7 percent chance that 25-year interest rates will exceed 10 percent, although surprisingly, this risk was slightly higher back in February. This is a fairly extreme scenario: long-term interest rates have not been above 10 percent since inflation was tamed in the mid-1980’s."

(Via NY Times.)

Ed Krugman - Stay the Course

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Op-Ed Columnist - Stay the Course - NYTimes.com:

"The debate over economic policy has taken a predictable yet ominous turn: the crisis seems to be easing, and a chorus of critics is already demanding that the Federal Reserve and the Obama administration abandon their rescue efforts. For those who know their history, it’s déjà vu all over again — literally."

(Via NY Times.)

Does anyone pay attention to history?

For The Slavery\Civil War\Reconstruction Buff In You - Ta-Nehisi Coates:

"I don't say this to be provocative, but there is no way to get around this--Slavery was big business. The antebellum Southern economy didn't have slavery as an unfortunate appendage--it was it's trunk, not a branch. We're not even talking about the damage done to the slaves themselves. "

(Via Ta-Nehisi Coates.)

Great, great post. Why I read this blog religiously.

Now That's Drinking the Kool-Aid

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Q&A: Microsoft's Windows marketing chief says Apple's 'scared' | Business Center | Macworld:

"I think [the way] they’re responding to our advertising is a reflection of what's happening out in the market (both IDC and the NPD Group show Mac sales dropping in the U.S. in recent months).

They're scared. The Ad Age survey shows how our brand is coming alive through three things: the ads, hitting our commitment to build a fantastic product with Windows 7, and around delivering the truth about the ‘Apple tax’ and the value you get when you go with Windows."

(Via Macworld.)

It's hard not to laugh at such delusions. Apple isn't sleeping on Microsoft, but scared? Jokes. I love the misdirection on the sales figures. Every manufacturer saw their sales slump, except Apple saw it's sales slump the least. Notice no mention in the interview of the Zune or Windows Mobile versus the iPod and iPhone respectively. Methinks somebody is projecting some fear.

The Ever Spending Story

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