I don’t think it’s an exaggeration to say that our electoral system is destroying our society.| www.interfluidity.com
I support Bernie Sanders in the Democratic primary. I don’t support Sanders because I think he is brilliant in some academic way. I don’t support Sanders because I am particularly impressed with the details of his policy proposals, although they are not nearly as hopeless as some self-proclaimed technocrats make them out to be. A democracy is not a graduate seminar.| www.interfluidity.com
Yves Smith at Naked Capitalism, riffing on a post by James Hamilton, ponders the question of why some CDO investors might have bought securities that were "losers at the start". Hamilton suggests that investors must not have understood what they were doing. As Yves puts it, "[H]ow could investors be so dumb? The buyers were institutional investors, after all. These guys are supposed to be pros." Yves suggests that underwriters, sometimes believing their own hype, sometimes with adroit porcine...| www.interfluidity.com
There are economies of scale in businesses. Some of them are technical. States should not try to insist that Mom and Pop should be able to bootstrap competitors to GM out of savings from their second job. But technical economies of scale peter out at scales much smaller than megafirms. Tesla, which (in physical, rather than casino-financial terms) is not so big, can compete with GM. Technical economies of scale require the scale of a factory, producing in quantities that fully amortize fixed ...| www.interfluidity.com
So, I don’t really write here any more. I write at drafts.interfluidity.com instead. Please follow that feed or subscribe by e-mail.| www.interfluidity.com
Here’s Paul Krugman:| www.interfluidity.com
A few weeks ago, Dani Rodrik issued a challenge:| www.interfluidity.com
I like this piece by Kate Aronoff looking back on WPA “boondoggles” in the context of a suddenly much discussed job guarantee. A lot of people deserve congratulations for the suddenly much-discussedness of job guarantee proposals. People like William Darity, Darrick Hamilton, and Mark Paul, Pavlina Tcherneva, Randy Wray, and others have worked doggedly through years of winter to keep this (by no means new) idea alive while no major political faction in the United States was willing to giv...| www.interfluidity.com
Yves Smith packs a powerful insight into an unassuming sentence:| www.interfluidity.com
Oddly (very oddly), I found myself last week at the INET Economics conference in Toronto. Larry Summers was the final speaker. His presentation was excellent. Whatever I might object to in Summers’ history or politics, he’s brought to the mainstream a set of views I’ve long held, and he is an engaging, cogent presenter.| www.interfluidity.com
Over the past decade, the United States has succeeded at exercising an extraordinary degree of “extraterritorial” control over the Western financial system. The apotheosis of this exercise was perhaps the nearly $9 billon penalty levied against BNP Paribas in 2014. Other non-US banks caught in the extraterritorial US net include HSBC, which paid $1.9 billion in 2012 for violating sanctions against Iran and laundering money in Mexico (for which it is in trouble again), Commerzbank, and man...| www.interfluidity.com
People I admire were calling each other nasty names last week, so I cowered in the corner, put my hands to my ears, and hummed very loudly. I’m talking about the debate over money and banking that involved Steve Keen (1, 2, 3, 4, 5), Paul Krugman (1, 2, 3, 4, 5, 6, 7), Nick Rowe (1, 2, 3), Scott Fullwiler, and Randy Wray among others. Here are some summaries by Edward Harrison, John Carney, and Unlearning Economics. Anyway, although there were some good moments, this debate just made me unh...| www.interfluidity.com
That’s obvious, right? But let’s belabor the point.| www.interfluidity.com
So, I don’t really write here any more. I write at drafts.interfluidity.com instead. Please follow that feed or subscribe by e-mail. I do still offer periodic roundups here of what I’ve been up to! And it’s been a busy few months. Without further ado. Unless it is remedied soon, the Supreme Court has rendered an […]| interfluidity
I am remiss. It is my nature.| www.interfluidity.com
It has become a cliché to say that this election is not about electing a President, but preserving democracy in America. That’s much less because of Donald Trump than because of the “doom loops” (in Lee Drutman’s term) between the two political parties. It’s bad enough that we have only two parties that leave most of us poorly represented. But as the parties increasingly differentiate themselves across issues of identity and culture, the “winner-take-all” nature of our electora...| www.interfluidity.com
Housing is a bitch.| www.interfluidity.com
3 very interesting posts!| www.interfluidity.com
It’s the ides of May, almost. What’s this?| www.interfluidity.com
February is one of the most beautiful and painful songs ever written, by Dar Williams.| www.interfluidity.com
Today I was reading Felix…| www.interfluidity.com
On Friday, St. Louis Fed President William Poole gave a speech called "Market Bailouts and the Fed Put" (hat tip Calculated Risk). Poole discusses "whether Federal Reserve policy responses to financial market developments should be regarded as 'bailing out' market participants and creating moral hazard by doing so." Unsurprisingly, Poole thinks not.| www.interfluidity.com
Right now we are the in the midst of the midterms, the news cycle is flying at us like hypersonic shrapnel, and we are bleeding. On the one hand, one does not want to give in to false flag conspiracizing. On the other hand, many of us believe that the 2016 election was significantly affected by manufactured news cycles. The slope between implausible conspiracy (“pipe-bomber dude was planted years ago by the deep state!”) and plausible manipulation of the news cycle (the “caravan”) bec...| www.interfluidity.com
This is the first part of a series. See parts 2, 3, 4, and 5.| www.interfluidity.com
It is almost February. Happy New Year! Time to round up drafts posts from, um, December.| www.interfluidity.com
Suppose that you are transported back in time several hundred years. You start a new life in an old century, and memories of the future grow vague and dreamlike. You know you are from the future, but the details are chased away like morning mist by a scalding sun. You marry, have children. You get on with things.| www.interfluidity.com
The newsletter platform Substack has grown controversial. For an overview of the controversy, see Ben Smith. To get in the trenches, read Nathan Tankus’ impassioned letter about why he’s leaving the platform.| www.interfluidity.com
As I have been for a while, I’m mostly blogging at drafts.interfluidity.com, posting occasional “round ups” here. Like this one!| www.interfluidity.com
We use the word “authority” to mean lots of things — police and state actors are “the authorities”, an expert may be “an authority on the matter, etc. But I want to suggest that it is very useful to think of authority as a characteristic of information in a social context. In particular, information is “authoritative” when some community of people to coordinate upon it and behave as if it were true, regardless of whether or not the information is in fact true, or even of wheth...| www.interfluidity.com
David Glasner has a great line:| www.interfluidity.com
The world is reminding us once again of its bleakness.| www.interfluidity.com
It’s been a while! There’s been nothing on this site, but I’ve been busy elsewhere. What writing I’ve done is mostly on my drafts blog. I’ve been largely devoted to tech-ish things lately, some of which I write up on a tech blog.| www.interfluidity.com
I was reading Matt Stoller’s newsletter this morning:| www.interfluidity.com
Lisa Pollack at FT Alphaville mulls a question: “Why are we so good at creating complexity in finance?” The answer she comes up with is the “Flynn Effect“, basically the idea that there is an uptrend in human intelligence. Finance, in this view, gets more complex over time because financiers get smart enough to make it so.| www.interfluidity.com
I continue to write these days beneath the shelter of my “drafts blog“. A big benefit of that is almost nobody reads it, so I feel much freeër to write. A downside is, well, almost no one reads it.| www.interfluidity.com
For the past week or so, I’ve been running an experimental “drafts” blog.| www.interfluidity.com
We often think about inequality in terms of supply of wealth to the wealthy. Interest rate declines contribute to inequality because they cause the real estate and financial assets held by the rich to appreciate. Monopoly contributes to inequality because it enables the owners of dominant firms to extract rents from the rest of us, increasing their already large hordes. To reduce inequality, we could break up monopolies, or stop enabling them with ever expanding “intellectual property right...| www.interfluidity.com
There is no other word for what the Democratic Party has just done to railworkers than betrayal. I am sorry, dear reader, if you don’t like to hear that.| www.interfluidity.com
I’m not going to get into the more contested parts of Effective Altruism, like whether AI safety is an urgent problem, or whether we should accept stronger-than-conventional views about animals’ moral weight.| www.interfluidity.com
Noah Smith has a good post on what, from a certain perspective, is kind of a puzzle. Why do real wages usually decline during inflations?| www.interfluidity.com
I remain adamantly in favor of ending the war in Ukraine now. I also adamantly favor Ukraine in the war. Despite apologetics from various quarters, Russia is straightforwardly the aggressor. A just settlement would repel the Russian Federation entirely from Ukraine’s internationally recognized borders, including Crimea. Russia plainly is not going to agree to a peace under which it slinks away from the territories it has just flamboyantly claimed to annex, let alone from Crimea, which it cl...| www.interfluidity.com