9 thoughts on “Monday message board

  1. James Hamilton (a US economics prof.) posts on US economics indicators and the subprime bank bailout at Econbrowser here. An extract:

    “…the fun and games in financial markets of the last two weeks, which continued yesterday with more Fed injections to the tune of $14 billion in 12-14 day repurchase agreements (meaning those reserves will come back out of the system in two weeks) and $3.5 billion in overnight. This again came on a day when the effective fed funds rate ended up at only 4.88%, confirming that the Fed is not currently targeting the effective fed funds rate. It’s also interesting that the recent trend in which there is a huge range of prices at which fed funds get traded each day is continuing…”

    This bears out stories I have read in other places about a covert reduction in the Federal funds rate.

  2. One has seen this sort of statement before, but its casual use by the New York Times caught my attention:

    “…The United States today is heading toward a Mexican-style social contract. The concentration of 44 percent of the nation’s income among the top 10 percent of taxpayers is on a par with Mexico’s disparities. It’s getting hard to find government officials in Washington without deep ties to corporate interests…”.

  3. I have a question about the triviality of the media:

    – Brendan Nelson committs 6 billion dollars of taxpayer money on a fighter plane we do not need from the US. This is about $500 per taxpayer. The Australian media barely touch it.
    – Brendan Nelson allows disgraceful goings on in the Defence Material Organization you can read more here:
    Again, very little media attention

    – Brendan Nelson admits to going to a strip club. The media goes nuts.

    Why do we endlessly discuss crap that doesnt matter?

    The old leftist line was that the media proprietors wanted to divert us from the real issues, but I wonder now, after reading with dismay the ‘most viewed’ stories on the Age and SMH, whether human beings are just preprogrammed to discuss rubbish, while we all go to hell in a handbasket.

  4. dave, garden variety ozzies have no information about, or power to participate in, government decisions. they are subjects, not citizens. so why waste time in matters outside your universe?

    ozzies are trapped in a cultural loop: can’t get democracy because they are told they have it, a ‘better’ version managed by their ‘betters’. if you are raised in a society where politics is a craft practiced by politicians, you don’t think ordinary people should do it, any more than they should all be panelbeaters.

    some people talk about public affairs, but since the public is effectively excluded from decision making, the talk is mere gossip. ozzies are grown up enough to have opinions, but they never grow up enough to demand power. they are a nation of perpetual adolescents. most are perpetual sheep.

  5. Observa, I suppose central banks will handle the next crunch the same way as they have handled this one. It’s almost enough to make you a gold bug.

  6. Not surprisingly, US economic blogs are awash with attacks on and defenses of the Federal Reserve’s bailout actions. While many commenters attack the bailout as protecting and rewarding wealthy profiteers who have created a dangerously unstable situation for their own benefit, the mainstream blogger Prof. Mark Thoma has stood up to defend the bailout as necessary to prevent a recession. It’s an interesting argument, you can read it here and here.

    Though Thoma is quick to admit that regulatory failures are at least partly responsible for the current situation, and that they should be rectified, there don’t seem to be any concrete suggestions. Nor is it clear to me where the incentive for such regulatory action is going to come from if the Federal Reserve is just going to make the pain go away by hosing it with money.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s