From the Globe and Mail: “Japan’s biggest four banks reported massive losses for the just-ended financial year Monday as the plunging value of the stocks they own hammered their earnings.... Japan’s megabanks have been saddled with mounting bad debts as they continue to lend to money-losing borrowers and get hit with new sour loans as quickly as they write off previous ill-fated lending amid general economic sluggishness.
Andrew Zimbalist, the Robert A. Woods professor of economics at Smith College, toys with such far-out concepts as the abolition of all antitrust restrictions on baseball. Taken literally, without antitrust restrictions, ball clubs would presumably be free to locate wherever they wished. ‘’If monopoly sports leagues did not artificially regulate the number and location of franchises,’’ he writes, ‘’then markets would be filled according to demand.
On balance, in fact, the steps being taken to pull the economy back from the precipice may delay the arrival of one able to stand on its own. “What we’re doing now is trying to create a cyclical pop with a massive policy response,” said James W. Paulsen, one of the few forecasters to predict the 2001 downturn and the chief investment strategist at Wells Capital Management in Minneapolis. “That may well succeed — I think it will.
David Warsh’s EconomicPrincipals.com this week discusses the change in the intellectual climate from the mid-1970s to today, in the context of three movements that rose up to challenge the social-democratic consensus, among which were the “’classical liberals’ or libertarians, exemplified by Ludwig von Mises, Friederich Hayek, Ayn Rand and Milton Friedman, worried by the threat to private enterprise posed by an expanding state.”
New York Times: “In the most palpable of ways, the American promise of a new Iraq is floundering on the inability of the American occupiers to provide basic services, particularly electricity, in Baghdad, a city with five million residents, about the size of metropolitan Houston, and the country’s economic heart. On the priority list of places where power must be restored here in the capital, business and industry are last, after hospitals, water and sewage treatment plants and residential areas.
James Grant: “The Money Printers” (Forbes): “Inflation, as defined by the great Austrian School economist Ludwig von Mises (1881-1973), is an unwarranted rise in the money supply—more exactly, a rise in the supply of money not offset by a rise in the demand for money. Rising prices are a symptom of inflation, not the thing itself. Thinking as the master thought helps to clarify the monetary situation.
Euro exceeds launch value (BBC): “By 1200 GMT the European single currency was worth $1.1789, up more than a US cent against the dollar. That value was easily in excess of the $1.1747 rate at which the euro closed on its launch day four years ago. And it puts the currency within a whisker of its all-time high, achieved during that first day’s trading.”
From the Wall Street Journal ($): Some of the devils in the details:
Capital Gains: “For lower-income taxpayers, lawmakers cut the 10% capital-gains rate to 5% and eventually zero in 2008. The new plan doesn’t make any changes in the basic rules for deducting capital losses -- a subject many readers have complained about in recent years.
A ”heraldic preference for war over peace may be indicated by a new eagle to the left of President Andrew Jackson’s portrait” on the new colored $20 bill, says Numismatic News (Collector.com)
San Francisco is known as the center of lunacy for the Left Coast, but this one takes the cake. It seems that homeless people are everywhere in that city. Of course, the folks there blame the federal government for not curing them. San Franciscans would never think of blaming themselves, since they have passed all sorts of laws from rent controls to setting off huge areas of “green space” that have made housing unaffordable in the Bay Area. On top of that, local government
