Should the Fed burst bubbles? Maybe in its role as regulator, if not monetary policy. Anand draws first blood in an amazing game. Robert Aliber’s "pooling equilibrium" idea for reviving asset markets. The splendid Alton Ellis, a giant of Jamaican music, just passed away. Credit indicators are easing. The demand for classic whiskey is robust.
From the FT article:
“At some stage, liquidity would return to the market in MRS and their market prices would reflect their prospective debt service receipts.
[...]
The accountants and their confrères that insisted on mark-to-market accounting should be made to stand in the corner for six months. The economic and business journalists that have shrilled about bail-outs should be given a six-month assignment to cover the daily fire and police department activities.”
That mark-to-market accounting rules were one cause of the aggravation of the crisis is a meme that deserves a better distribution through the blogosphere.
On Alton Ellis, where’s a good place to start? Recommend an album or two please.
Tyler (or anyone else),
Can you recommend a place that covers chess at a level a novice understands? I basically know the rules and have played a dozen times, but don’t know a queen gambit from a czech defense.
John Conlon at the University of Mississipli’s Econ department has some papers on Central Bank bubble-bursting policy, with (what seemed to me) good lit reviews.
So, is the Fed implying they didn’t burst the current bubble with a truck full of dynamite?
Steve,
Many, many years ago, I learned the fundamentals of chess from this book by Siegbert Tarrasch. It is a book geared toward beginners.
As you read, I would suggest playing lots if interested. Yahoo Games has a very active chess room with players of all skill levels- I play there often under the ID of madscientist35a.
Should the Fed burst bubbles? Maybe in its role as regulator, if not monetary policy.
If one thinks that the Fed created the housing bubble, then the above two sentences are truly scary. It would be akin to Richard Nixon saying, “What’s the story with these rising prices?! We’ll combat them through legislation, if not monetary policy.”
Tyler, I realize you think Greenspan’s negative real interest rates were, at most, necessary but insufficient conditions for the housing boom. Fair enough. But even if you think it really was “market failure” that caused the present mess, I am continually surprised at how easily you throw out the suggestion that maybe regulation X or regulation Y, or a few hundred billion here or a few hundred billion over there, will make things better, going forward.
Do you actually trust the real human beings who are in DC right now, or who will be in there after the election, to implement a Pareto improvement? Did you hear Obama and McCain talk about their, shall we say, nuanced endorsement of free trade in the last debate? (Hint: It doesn’t include cocaine imports for McCain, and it doesn’t include car imports for Obama.) And one of these two clowns is going to correct the flaws in second-best outcomes due to asymmetric information in the financial markets?
I’ve been trying to persuade sailors in Wales to bootleg scotch (to Iceland?) without success.
Steve: I would second the suggestion of playing lots (@yahoo for example). I would also suggest chessgames.com so that you can see lots of the patterns for yourself. I’ve always admired Fred Reinfeld’s style in chess writing, but the opening lines he talks about in his primers are largely out of fashion now.
Perhaps the best elementary-intermediate modern guide to chess is Jeremy Silman’s Complete Book of Chess Strategy. Silman is a noted modern chess writer and a popular teacher — deservedly so. He is a better guide for a new player than Tarrasch or Reinfeld who will sound dated. The other good thing is that this book allows you to dip into it from time to time without having to go through cover to cover.
The Federal Reserve should stabilize the value of the dollar, period.
The Fed should have a minimal involvement in the economy, they should really only worry about the value of the dollar, but hey that’s in an ideal world. In the real world the Fed thinks they are Superman and can fix something out of their control, when in reality they are more like Hancock, just screwing it up more.
Is this a countercyclical asset?
http://www.guardian.co.uk/books/2008/oct/15/marx-germany-popularity-financial-crisis
there is some argument that this mess was caused by the fed trying to pop a bubble.
http://www.tcsdaily.com/article.aspx?id=101708A
Is it realistic?
you can give more strange mind and make a crazy
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