The Drug War Tragedy

Of all magazines, Rolling Stone has a surprisingly comprehensive overview of the war on drugs. Very good companion piece to the movie Traffic, and the excellent BBC miniseries it was based on.

Against Expert Advice

Heartwarming story from Malawi. No doubt that left wing will look at this as evidence that free markets do not work in many situations. But my opinion is that this actually is a case of markets actually working, as long as you consider the government as part of the market. Academics usually tend to consider government as an entity that operates outside the market, but the reality is that the goverment IS an inherent stakeholder in the market. In this case the government considered an investment case where if they invested in the fertilizer, the returns to the whole economy increased. So like any rational actor in the market, they invested. The simpleton in this story is the western advisor who looked up his textbook - saw the maxim that government subsidies are bad - and repeated it without looking at the overall return to the economy. Dont attribute to market failure what you can attribute to stupidity. All governments (free market or otherwise) undertake projects that generate returns for the economy as a whole. The problem with planned economies is that they frequently tend to invest in projects that have poor returns to the economy. And the problem with naive academics is that they tend to put theory over pragmatism.

Macroeconomic Insanity

Nobel laureate Paul Samuelson argues for more credit infusion into the market, as well as regulation changes to help out the mortgage borrowers. However there are others (Ben Stein et al) who argue that the problem is relatively tiny when compared to the size of the entire real estate market. And congressman Ron Paul has of course thrashed Ben Bernanke that credit infusion will lead to higher inflation and further devaluation of the dollar. Paul Krugman thinks higher saving rate leads to a weaker dollar. And if you are not confused enough, then there are the conspiracy theories that link it all to elite puppeteers, war, finance, and religion. Fun times.

Michael Lewis on Investing

Lewis outlines the story of Dimensional Fund Advisors, which advises its clients to not churn stocks unlike other firms that actively trade. Interesting quotes:

"If you wake up in the morning and see Warren Buffett's face in the bathroom mirror, go ahead and buy some stocks. If you see anyone else’s face, diversify.”



"If you put a thousand people in barrels and push them over Niagara Falls, some of them will survive. And if you take those guys and push them over again, some of them will survive. And they’ll write books about how to survive being pushed over Niagara Falls in a barrel."

Whether the efficient market hypothesis is right or wrong is beside the point - what is really important is that there is absolutely no information in the past stock price data. Without insider information, everybody is better off buying low cost index funds or ETFs.

The Consequences of Mr Bush

Joseph Stiglitz lays out the case why Bush's policies have devastated the economic landscape of the country. Very substantial indictment - goes well with Ron Paul's public spanking of Ben Bernanke.

CIA and the Iranian Coup

Interesting feature from the NYT summarizing the involvement of the CIA in the 1953 Iranian coup. Quite interesting to note how CIA's efforts in curbing communism, the evil du jour, led to the rise of islamic fundamentalism in Iran - just like it did in Afghanistan (detailed marvelously in pulitzer winning book Ghost Wars by Steve Coll)

Ron Paul Surging

The Iowa electronic markets [graph] has the gynecologist towering over John McCain and Fred Thompson. And this is right on the heels of the bookies in london upgrading his odds of winning. This could get very interesting very soon - I hope he hangs around for a while.

Gene Simmons versus Terry Gross

This has to be one of the strangest interviews (12MB Mp3) NPR has ever aired. Gene starts off using a lot of bookish words but the conversation quickly degenerates (or gets fascinating, depending on your outlook). He is at various points in the conversation - sexist, delusional, funny, sincere, enlightened - I'm just not sure where he switches from one to the other. Well done Terry persevering through this interview. Probably diagonal opposite of the NPR Sigur Ros interview.

Frontline

The show's 2007 season kicks off with an excellent episode. Available to view online. Fits in very well with Naomi Klein's contention that governments use catastrophic events to expand their powers that could not have been achieved through normal procedures. Eminently watchable.

On Swearing

Steven Pinker on cussing - overview of linguistics, psychology, history, and the current attitude.

Tips for Healthy Eating

Five tips from across the continents - fairly simple and intuitive.

Where's the coverage?

This is exactly the kind of news that gets drowned out while the media freaks out about Chinese products.

Civil Liberties and False Positives

The Economist has a brief and lucid editorial on civil liberties. Quite unexpected from the bastion of rightist thought.

Migrant Statistics

Another excellent interactive graphic from NYTimes - this time about migrants by country, and the amount of money they send home.

Housing Prices in Major Cities

NYT has an interactive graphic that charts housing prices (both nominal and real) vs national averages.

LA Homicide Map

The LATimes has a site that maps out the homicides in the county. Data rich and interactive, it is fascinating. For example not only was I able to find out that there were three homicides in pasadena (well, northern pas to be exact) - I could find out there names and the details surrounding the crime. Macabre yet engrossing.

Debtor Nation

Meaty article in the Harvard mag that analyzes the US debt/deficit situation. It is, like most interesting problems, multivariate in nature and nobody really knows with any certainty what is going to happen in the future. But regardless, some very interesting points in the market - Why is China holding on to so many US T-notes? How are the current trade deficit and the housing price bubble related? What happens when foreign investors decide to withdraw their investment in the dollar? The article doesnt quite do justice to all these weighty questions - can someone quickly write a book with all (or some) of the answers?

Restting ARMs

Looks like there is going to be a world of hurt for mortgage borrowers in 2007 ...

Cerberus

A not too deep glance into the opaque world of private equity and Cerberus Capital.

The Two Chinas

ESPN, the unlikeliest of magazines, has a profile of China drawn around the theme of Olympics. It is a fairly engrossing travel narrative describing how a cross section of the country is changing in the new millenium.