Paul Krugman, who tells us that assets and capital are homogeneous when it comes to economic policy, suddenly claims that there were malinvestments during the boom! (Actually, he does not use the M-word, as he would not know what it means, but I digress.)
The Great One writes:
The business of political capitalism, that is. Like Enron, Goldman operates primarily in the nebulous world of public-private interaction. It is the US’s most politically powerful financial firm, skilled at navigating the byzantine regulations governing the virtually nationalized US financial sector.
One can not help but find what is perhaps the strangest news story of the day a bit prophetic. A man in north Texas received a $23 quadrillion Visa bill. The charge was made at a restaurant in Dallas. Obviously this was a computer error and this gentleman didn’t run up 200 times the national debt on his visa.
The PPI was released yesterday (up 1.8% in June) and today the CPI appears, showing an upward move since December 2008, and now rising at a 3-month seasonally adjusted annual rate of 3.3%. The food index has stopped falling.
Just when the market cleans the air, in steps the regulators. The e-cigarette solves the smoke issue by atomizing a nicotine solution in a pen-size device. Pretty slick. But, wait. The feds consider the e-cigarette a nicotine delivery system. Sure, and Mountain Dew is a caffeine delivery system, just as Ho-Hos are a sugar and fat delivery system. Big deal.
I just came across a letter from a mainstream economics journal from 2003 rejecting my paper “Skyscrapers and Business Cycles.” It reads in part that “this journal focuses upon specification and testing of formal macro and monetary models and does not publish papers like yours in which the theorizing and testing is more casual-descriptive than formal-econometric.”
