2. There is no great stagnation (juvenile, skip it).
4. Another superb Michael Hoffman review, this time of Martin Amis on Auschwitz.
6. Contrary to a behavioral econ claim about threshold earnings, taxi drivers in fact have positive elasticity of supply.
7. Elisa New (wife of Larry Summers) has a poetry MOOC from Harvard, Larry will appear to discuss economics and poetry with her.
1. Good essay on risk communication during pandemics (though it focuses on flu, not Ebola).
3. What Saddam Hussein said in public vs. what he said in private (hat tip www.bookforum.com for the last two links).
From 1973 to 1985 German inflation was most of the time over two percent a year, sometimes much over two percent. In 1973 it hit eight percent and in the early eighties it exceeded six percent a year. Source here (pdf), see p.6.
From 1951-1973, the Germans seemed happy with roughly the same inflation rate as what Americans had. Source here (pdf), see p.9, and also p.13, passim. In the early 1970s, the rate averaged almost seven percent a year for a few years (p.15). It is fine to note the role of oil shocks here, and in the earlier period Bretton Woods, but still Germans tolerated the higher inflation rates. They expected the alternatives would be worse and probably they were right.
The claim that the current German dislike of inflation dates back to unique memories of Weimar hyperinflation is dubious. Rightly or wrongly, today’s Germans associate high rates of inflation with wealth transfers away from Germany and toward other nations. More broadly, Germany is a more flexible country than outsiders often think, not always to the better of course.
So for once I can intelligently comment on a Marginal Revolution article. (I have a Ph.D. in applied plasma physics and fusion energy; I worked on the “conventional” fusion reactor design, the tokamak). Lockheed hasn’t released many details of their concept (at least, not enough details that it can actually be evaluated in technical detail), but it looks like it’s a combination of a magnetic mirror and a levitated dipole. The magnetic mirror was studied in detail in the 1960s and 1970s and didn’t work out (due to [detailed plasma physics reasons]) and the levitated dipole has a fundamental flaw as a power-producing reactor in that the superconducting magnets are inside the neutron shielding – neutrons destroy the magnets.
It’s tough as a scientist to be able to comment on things like this, because it’s “science by press release”, i.e. there’s a big media hype but the actual researchers don’t release enough technical details to actually evaluate it. One wants to remain cautiously optimistic, but with fusion in particular, we’ve been down this road many, many times. Thus I predict that the most likely outcome is that as they scale their device up, they’ll find that the confinement (a measure of how well the device holds a fusion plasma) unexpectedly drops off due to some different types of turbulence turning on at higher temperatures / higher pressures… and it will quietly go away.
I hope that I am proven wrong.
There are other interesting comments at the link and Kottke offers more.
2. E. Glen Weyl on the openness-equality tradeoff in global redistribution, or is there a case for the Gulf monarchies?
4. When is martial law a tourist attraction? (the culture that is Thailand)
7. Monetary policy with interest on reserves (speculative)
1. HBO will be letting you watch their shows on-line without buying cable (the great unbundling).
4. “I don’t really know if they love me, or if they love my height.” (markets in everything, and do we need more Amazons?)
Victor Mallet writes:
Amid gloom over global economic growth and uncertain prospects for emerging markets, India is beginning to stand out as uniquely well-placed to gather the windfall benefits of an international slowdown.
Unlike Brazil, Russia or South Africa, India reaps immediate advantages for its terms of trade and its domestic budget from the fall in commodity prices triggered by renewed concerns about the world economy.
And unlike China, India will not suffer much from any decline in global demand for manufactured goods because its export sector is relatively small.
Commodities – mostly oil – account for more than half of India’s imports but only 9 per cent of its exports, mainly food. The current account deficit falls by about $1bn a year for every $1 decline in the price of a barrel of oil, and the reduced cost of fuel subsidies is also easing the burden on the budget.
Another benefit of weaker commodity prices is falling inflation, long the bane of the Indian economy.
Here is Guy Norris:
Hidden away in the secret depths of the Skunk Works, aresearch team has been working quietly on a nuclear energy concept they believe has the potential to meet, if not eventually decrease, the world’s insatiable demand for power.
Dubbed the compact fusion reactor (CFR), the device is conceptually safer, cleaner and more powerful than much larger, current nuclear systems that rely on fission, the process of splitting atoms to release energy. Crucially, by being “compact,” Lockheed believes its scalable concept will also be small and practical enough for applications ranging from interplanetary spacecraft and commercial ships to city power stations. It may even revive the concept of large, nuclear-powered aircraft that virtually never require refueling—ideas of which were largely abandoned more than 50 years ago because of the dangers and complexities involved with nuclear fission reactors.
Here is another account. It is suggested that the reactor can fit on the back of a truck.
In response to such speculative reports I usually say: “If it’s true, why isn’t the price of oil down?” But these days the price of oil is down! I am not suggesting this is the reason, but at least I can no longer say “If it’s true, why isn’t the price of oil down?”. I have to say something else, so if this is true — which I cannot judge — there is no great stagnation (any more).
For the pointer I thank various MR readers.
3. Leonard Liggio has passed away. Leonard’s voracious reading habits, and gentle nature, were very much a role model for me. We will miss him.
6. Data on rebounds.
Terrence McCoy reports:
Schultz wants $150,000 for Ebola.com — a price he thinks is more than reasonable. “According to our site meter, we’re already doing 5,000 page views per day just by people typing in Ebola.com to see what’s there,” said Schultz, who monitors headlines the way brokers watch their portfolios, to gauge his domain’s worth. “We’re getting inquiries every day about the sale of it. I have a lot of experience in this sort of domain business, and my sense is that $150,000 is reasonable.”