This American Life on Healthcare

Many insights on the american healthcare system from the stellar NPR show, such as:

• Having more doctors raises healthcare costs (the supply drives the demand, unexpectedly - an upward sloping demand curve, egads)
  
• One third of medical spending is on procedures that do not make us any better ... (like that time when a doctor prescribed a CAT scan for me when I reported a blocked nose)
  
• Perverse incentives - doctors get paid more for prescribing more procedures, even when they might hurt more than help
  
• The Prostate Cancer PSA test - the issue with false positives. When you run a test across the entire population, you are going to identify a whole lot of people as positive who never would have developed the cancer.
  
• Patients as Plaintiffs - doctors reject guidelines and do not follow evidence based treatment, just to minimize the chance of getting sued
  
• Hospital monopolies are just as bad for consumers as insurance monopolies.
  
• Costs will keep rising until consumers make sacrifices (and they will not make sacrifices if part of the costs are not passed on to them).
  
• Patients unwittingly side with doctors when negotiating prices of procedures, even if if makes sense to side with the insurers as they are the ones representing us financially
  
• Medical facilities and insurers have similar levels of profitability. And if they are running on a fixed margin basis, there is no incentive to keep costs down.
  
• Costs are going up so fast that there is broad consensus that something has to change. Things are hopeless across the board, and that gives us hope that something will be done.
  

Not only is the earth flat, its also brutal.

Matt Taibbi takes some time out from burying Goldman Sachs to bury Tom Friedman. Hilarious, and with prose that is ... lets say, unrestrained.

Fisherman Bankers of Iceland

Michael Lewis with an ethno-analysis of Iceland crash, rather than the standard economic one. Vivid writing, and interesting conclusions. Reading it almost felt like watching a documentary. Definitely one of the best bits of journalism last year.

Link love

Just throwing reddit some link love so that they can unseat scientology for #1 rank for the query "is it possible to be happy".

Key Concept: Thought Terminating Cliche

The language of the totalist environment is characterized by the thought-terminating cliché. The most far-reaching and complex of human problems are compressed into brief, highly reductive, definitive-sounding phrases, easily memorized and easily expressed. These become the start and finish of any ideological analysis.
- Robert Lifton, M.D from book Psychology of Totalism

Goldman and AIG and Express Suicide

Hank Paulson was on Charlie Rose couple days ago claiming that Goldman Sachs did not see the housing bubble blowing - but this NYT article clearly shows that GS bet billions on the fact that the housing prices would go down.

Another strange thing in the article - AIG sold insurance that was, in part, contingent on its own financial health. That is, if it ever was in a compromising position, it would be required to pay out more. I would call it the Express Suicide clause. The consensus in this whole debacle seems like GS was able to find a trading partner who was rich and incompetent, and just big enough that it could be deemed too big to fail.

And now if the banks claim that they have returned the TARP funds, the follow up should be - has AIG? AIG is just as likely as GM to pay back anything. And those losses directly paid off GS ($12+ billion) and others like Societe General.