Chris, a loyal MR reader, asks:

Why does the corporate world use language so inefficiently? Why turn a simple thing like "talking to a client about their needs" into a five-step process (distinguished, no doubt, by an acronym)? Do companies think that they create net value when they brand a common thing like human conversation as a one-of-a-kind, complex process – even after the costs of being opaque, jargonistic, and long-winded are taken into account?

I assume that a large proportion of people become cynical at the sound of corporate-speak. Is it reasonable to expect that language in the business world will become more transparent and down-to-earth in the future? Or do you expect that corporate-speak will continue to serve the (perceived) need to brand the commonplace or to affect a marketable expertise – clarity, concision, and common sense be damned?

My speculation: People disagree in corporations, often virulently, or they would disagree if enough real debates were allowed to reach the surface.  The use of broad generalities, in rhetoric, masks such potential disagreements and helps maintain corporate order and authority.  Since it is hard to oppose fluffy generalities in any very specific way, a common strategy is to stack everyone's opinion or points into an incoherent whole.  Disagreement is then less likely to become a focal point within the corporation and warring coalitions are less likely to form.  

Many morale-improving corporate practices are precisely what people perceive as somewhat demoralizing, such as fluffy rhetoric, forced socializing, and a somewhat egalitarian bonus structure.  Rule of thumb: when you see the demoralizing, start with the premise that it is being done for morale.

Real "straight talk" very often is not compatible with authority, as it breeds conflict.  Do political leaders give us much real straight talk?  Do CEOs in their public addresses?

When direct financial incentives can work well, such as in sales (bonuses) or in some parts of finance, there is much more straight talk.  Disagreement and candor can flourish, because the $$ keep the workers on a common track.

My lunch group has a high level of trust and we are at little risk of a morale breakdown and thus we speak very directly with each other with a minimum of fluff or BS.  

Both theory and data suggest that lower real rates cannot account for more than one-fifth of the boom in house prices.

That's from Edward Glaeser, Joshua Gottlieb, and Joseph Gyourko; here is more.  Here is some of the theory:

If people expect to move in the future, low interest rates today will not lead them to bid up prices so much now because they realise they might have to sell later at a lower price when rates are higher. The option to prepay also weakens the link between current interest rates and house prices for the same reason. Rates also should have little or no impact on prices in elastically supplied markets as shown in Glaeser et al. (2008).

Finally, if people are credit-constrained, lower rates today need not lead to higher prices. After all, if the marginal buyer cannot take advantage of those lower rates, they should not affect the buyer’s valuation of a home. Taken together, we show that these factors can reduce the predicted impact of interest rates on home prices by about two-thirds, bringing it down to 6 or 8 from previous conclusions of around 20.

A Venezuelan politician is offering breast implants as a prize in a raffle to raise funds for his parliamentary election campaign.

"Some people raffle TVs and we decided to offer this. It's an interesting prize and there's a lot of interest," Gustavo Rojas, an opposition candidate for a National Assembly position, told Reuters while campaigning in Caracas.

Here is his defense of the policy:

"The raffle is a financing mechanism, nothing else. It's the doctor who will do the operation, not me," he said.

The link to the story is here and for the pointer I thank MikeRosenwald and also Daniel Lippman.

Despite all the alarmist rhetoric, the bond vigilantes have been perfectly happy with the JGB market, presumably because Japan offered something much rarer than mere fiscal rectitude, namely deflation.

Here is more.