The Stash

Worth Reading
November 17, 2009

What will happen to Berkshire Hathaway after Warren Buffett dies? The best day to buy a car: Black Friday. Home prices in southern California tick upwards. Hong Kong says Fed policy is creating bubbles in its markets. The Boston Globe endorses Bill Belichick's 4th-down call.

Where to Put Your Foot Down With the Chinese
November 17, 2009

As I mentioned yesterday, I'm somewhat skeptical of the benefits of "getting tough" with the Chinese on issues like currency manipulation and our trade deficit. (I think you need to do it, but you've got to be sophisticated about it.) But Obama's town hall meeting in Shanghai, which was heavily stage-managed by the Chinese, is one place I think the administration really should have gotten tough. From the NYT: The event in some respects signaled a retreat from the reception given at least two earlier American presidents, Bill Clinton and George W.

Are We Overpaying On Our Afghan Bribes?
November 17, 2009

Mike Allen highlights an interesting piece from the Times of London in today's Playbook. Apparently the British army has just released new counter-insurgency guidelines with an emphasis on bribing potential Taliban recruits in Afghanistan: "Addressing the issue of paying off the locals, the new manual states that army commanders should give away enough money to dissuade them from joining the enemy," the paper reports.

Should We Chill Out About Government Debt?
November 17, 2009

David Leonhardt has a great catch from a recent Larry Summers speech up at the Times Economix blog today. In the speech, Summers made the following observation: … even with the dramatic action of the Treasury and the Federal Reserve, the total level of borrowing in our economy is actually lower than in normal times, not higher.

Worth Reading
November 16, 2009

Meredith Whitney is bearish on banks. Bernanke isn't ready to call asset prices inflated. What's behind the tight correlation in commodity prices? Surowiecki: U.S. economy suffers from "debt bias". Malcolm Gladwell needs to brush up on his linear algebra.

Quibbling with Krugman on the Chinese
November 16, 2009

I agree with pretty much everything Paul Krugman writes in his column today about the Chinese and their currency shenanigans--especially the point that the Chinese have rigged it so that our bilateral trade deficit will spike once the recovery gets going. (And the point that the forces driving our trade deficit were only temporarily suppressed by the recession.) The only thing I'd quibble with is the implication of these two paragraphs: So picture this: month after month of headlines juxtaposing soaring U.S.

Why Short-Selling Bans Are Dumb
November 16, 2009

Regulators around the world, including our own SEC, succumbed to populist fervor following the Lehman collapse and banned short-selling "to protect the integrity and quality of the securities market and strengthen investor confidence." It's still an open question as to whether the ban had any positive effect on investor confidence, but evidence is piling up that "quality" -- a market's ability to provide liquidity and price discovery -- headed south.

Total Incoherence on Deficit Politics
November 15, 2009

Scott Rasmussen and Doug Schoen had a completely mystifying op-ed about Obama's political standing in yesterday's Wall Street Journal. On the one hand, they argue that his biggest political problem is unemployment (correctly in my mind): The announcement a week ago of 10.2% unemployment is a significant political event for President Barack Obama. It could well usher in a particularly serious crisis for his political standing, influence and ability to advance his agenda. Double-digit unemployment drove Ronald Reagan's disapproval ratings in October 1982 up to a record high 54%.

Talking Budget Cuts Before Seeing Our Lenders (i.e., China)
November 15, 2009

The last two days have brought two very interesting stories that highlight a key link between domestic policy and geopolitics.

David Brooks, John Thune, and the Death of GOP Reform-ism
November 15, 2009

I think David Brooks's column about John Thune on Friday tells us a lot about the debate over the GOP's future. Brooks, of course, has been a leading (and compelling) reformist voice for years now. Here's how he summarized the reform agenda in a column just after the 2008 election: The other camp, the Reformers, argue that the old G.O.P. priorities were fine for the 1970s but need to be modernized for new conditions. The reformers tend to believe that American voters will not support a party whose main idea is slashing government.

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