Archive for August 2007
Was Greenspan a big softy
Posted by: Matt Nolan on: August 31, 2007
Yves Smith think so. His argument is that, even though we didn’t fully appreciate it at the time, Greenspan really really cared about equity markets. He was scared of them, and he didn’t want to go out there and nail them as much as he should have. By being ‘hostage’ to the equity markets, Greenspan [...]
Working out your level of attractiveness
Posted by: Matt Nolan on: August 31, 2007
I was having a discussion with my girlfriend yesterday on a blog post by Tyler Cowen. There are a lot of interesting points in the post, but the one that struck me and led to the discussion was: “The median photograph of you is probably the best approximation of your physical attractiveness “ The reason [...]
Seniors gold card
Posted by: Matt Nolan on: August 30, 2007
Winston Peters has come to the rescue of the elderly by delivering a gold card. Now blah blah people are complaining that the discounts are not enough and blah blah people are annoyed they don’t get discounts on power. I don’t really care about that. What excites me the idea of why firms may be [...]
The Teachers union should sit in on some 5th form economics classes
Posted by: Matt Nolan on: August 29, 2007
So teachers want a pay rise. This isn’t really surprising given the inflationary pressure in the economy. Now I don’t know too much about teachers pay, but I did find it interesting that the teachers union is saying that teachers wages should increase by 7.5%, and that this would reduce the average size of the [...]
Property finance Ltd goes bust
Posted by: Matt Nolan on: August 29, 2007
So that makes it six finance companies in 15 months. What does this mean for the NZ credit market? NZ banks should not be significantly effected. Banks are in relatively good shape, and all the recent trouble in secondary, non-bank financial institutes, is likely to increase demand for low yielding, low risk bank products. However, [...]
Economic scissors: Trial and error
Posted by: Matt Nolan on: August 28, 2007
Supply and demand, the economic scissors. This beautiful diagram explains a significant amount about how economists think: Now from what I understand, when the two curves cross we have equilibrium. This sets a price where demand and supply are equal. When the price is higher we have a surplus of goods, here some of the [...]
If there is no free lunch why should we have free software??
Posted by: agnitio on: August 28, 2007
I have always been skeptical of open source software, if Microsoft and all of their highly paid programmers can’t get it right, how can a bunch of guys who work on projects for free in their spare time do any better? As a recent convert to Linux I now realize how wrong I was. In [...]
More immigration?
Posted by: Matt Nolan on: August 28, 2007
So, our labour market is looking extremely tight. According to the department of labour all nine of the main occupation classes are currently suffering from labour shortages, and these shortages are likely to continue into the medium term. So the country needs more workers, and it takes time to breed them, so why don’t we [...]
The new SAP in Iraq
Posted by: rauparaha on: August 27, 2007
A commenter on the ‘Democracy and Growth’ post below said that he didn’t think “…growth was ever a putative justification for the invasion of Iraq”. While that may be the case, it didn’t stop the US from using post-war Iraq as a playground for a few ideologically driven economists. Using a regime that reminds one [...]
Outgrowing Inflation II
Posted by: Matt Nolan on: August 27, 2007
Rod Oram has had another crack at explaining why he thinks higher output will lead to lower inflation. His argument is, that higher output can help us reduce housing, labour, and business capacity constraints which are dogging the economy. The first point seems to be his main one, that there are too few houses and [...]
The week in numbers
Posted by: Matt Nolan on: August 24, 2007
Tourist arrivals were strong, up 3.6% on July last year. Net migration for the year to July was weak at 8,966. The merchandise trade balance continued to deteriorate, with a deficit of $6.3bn for the year to July.
Holy Cow
Posted by: Matt Nolan on: August 24, 2007
Have you seen the latest estimate for Fonterra milk payouts, $6.40! I know that Holy Cow was a terrible pun to make, but that’s a huge payout. Supposedly Fonterra was able to hedge sales at $US0.71 during the time when our dollar was at $US0.80. When that good bit of management is combined with the [...]
RBNZ introduces some liquidity
Posted by: Matt Nolan on: August 23, 2007
The RBNZ has made it easier for banks to borrow money off them, in order to stave off a squeeze in credit in the banking sector. This sounds fine to me, and the measures they put in place seem reasonable, there was one thing I did not understand though. It says that the bank is [...]
Outgrowing the inflation problem
Posted by: Matt Nolan on: August 23, 2007
In this article, Rod Oram discusses the two options he sees for battling inflation: Raise interest rates to slow growth, thereby reducing the pressure on our limited resources. Increase the resource base Both of these ‘strategies’ would reduce inflationary pressure. One would reduce aggregate demand; the other would increase aggregate supply. The first strategy is [...]
Democracy and growth
Posted by: rauparaha on: August 22, 2007
One of my favourite development economists, Daron Acemoglu, has a new paper out. Acemoglu is generally of the view that a country’s level of wealth can be traced back to the country’s institutional development. In a fascinating earlier paper he argued that the institutions set up by European colonists are a major predictor of the [...]
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