Saturday, May 09, 2009

Weekend reading from around the blogroll...

Save the Earth! Fight the next hike in the price of stamps! United States postal charges correlate better than atmospheric CO2 with global warming, via

Why sports fans go to the stadium to stand in the stands in Europe and sit in the stands in the U.S., as per the Sports Economist.

Little notes on an OECD study on leisure, from Tim Worstall. (Shopping may be leisure for women but not men? Watch out, OECD, remember what happened to Larry Summers!)

Speaking of leisure, who's getting sloshed where, around the world. (Greenlanders and Hungarians more than Russians?!) via Carpe Diem.

Looking at inside stock traders, and who's not selling...
"[Corporate] Insiders are selling at a rate not seen since the top in 2007.... What was not noted though is that there is not a single bank executive on the list of sellers. Not one. ... My slogan for analysing banks is to watch what they do not what they say." -- John Hemption

"Don't tax you, don't tax me, tax businesses across the sea". Obama says, "For years, we’ve talked about ending tax breaks for companies that ship jobs overseas and giving tax breaks to companies that create jobs here in America." How he now proposes to do it is explained by Keith Hennessey. Protectionism by any other name smells as sour, as will its results.

"Too big to fail" is not the problem with the banks, and "make them smaller" is ridiculous not the solution, explains Economics of Contempt.

Moody's is predicting a tripling of the default rate on corporate debt next year -- to a level higher than during the worst days of the Great Depression. My God! Why?
Moody's is getting beat up for not calling the recent crisis and rubber stamping ratings on the disastrous 'mortgage innovations' ... so like any good forecaster who missed the turning point, they are sure to err on the other side going forward ... predicting doom and gloom has an obvious advantage ... People are much more foregiving of an overly pessimistic forecast than an overly optimistic one ... Consider all the lawsuits in the pipeline against the Ratings Agencies, and note the absence of lawsuits for whenever defaults were below average.

As per optimistic forecasts, there are few benefits to mere accuracy. When have you heard of a risk manager getting an extra bonus for predicting low probability events won't happen that subsequently don't?

The default rate for speculative grade loans was 4.1% in 2008, which is 71st out of the 89 years of data on this series. Well below the 2001, 1990, and 1970 peaks. The prediction for a 16% default rate in 2010 is for a record year in defaults, higher than any year, including the peak of 15.4% in 1933.

If the End of Times comes, you can't blame the current Moody's personnel for not warning you. -- Falkenblog

Considering why "fiscal stimulus" is being rejected by the most liberal, big government (even "socialist") countries of Europe, whom Americans might assume would be all-for it, Scott Sumner tells us that the Nordic countries....
are successful in erecting a large welfare state. Once they achieve this success, however, they start running into problems ... In response they frantically cut away at all sorts of non-essential statist interventions, anti-market policies that don’t seem to have much egalitarian benefit ....

Most importantly, they privatize everything in sight. Not just Conrail, like we did. But also passenger rail, postal services, highways, water systems, air traffic control, airports. In other words exactly the sort of public services that if I told my liberal friends should be privatized, they would call me a reactionary. -- TheMoneyIllusion
And he's right. Sweden has a 100% voucher public school system, private accounts in Social Security, and privatized public transport. But you never hear this from liberals who promote "the Swedish model". Yes, Swedish social-economic policy is too right-wing for US Democrats.