Author Archives: Felix

Airline Economics Datapoint of the Day

Posted on September 27, 2007 by Felix

Market capitalization of AMR, the parent of American Airlines: $5.4 billion Value of AMR’s AAdvantage frequent flier program: $6 billion

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Misleading Chart of the Day

Posted on September 26, 2007 by Felix

The Wall Street Journal has a story entitled "Tech Stocks Get Giddy 🙂" today – and yes, the smiley is in the headline. It’s accompanied by a dreadful chart showing three stocks which are currently at all-time highs: Research in … Continue reading →

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GE, the Old-Fashioned Lender

Posted on September 26, 2007 by Felix

Do you remember when commercial banking was all about knowing your client and your clients’ industry and having strong relationships and parking billions of dollars in loans in some dusty old part of the balance sheet which never got marked … Continue reading →

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Alan Greenspan, Comedy Mastermind

Posted on September 26, 2007 by Felix

The penguin nails it.

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When a Property Bubble Isn’t Speculative

Posted on September 26, 2007 by Felix

Now that I’ve started noticing the "speculative bubble" meme, I seem to be seeing it everywhere. The latest person to use it incorrectly (IMHO) is none other than Robert Shiller: According to the Standard & Poor’s/Case-Shiller US National Home Price … Continue reading →

Posted in housing | 1 Comment

Who Won in the GM Strike

Posted on September 26, 2007 by Felix

Andrew Leonard asks today whether anybody won in the showdown between GM and the UAW. "There’s no triumph in this deal," he concludes. "Just resignation." I’m slightly more optimistic, and I’d say that both sides won. After all, a strike … Continue reading →

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Why the Ratings Agencies Should Fear Congress

Posted on September 26, 2007 by Felix

There was a lot of bashing of the ratings agencies this morning at the Portfolio subprime panel. It was timely, coming as it did ahead of Congressional hearings on the ratings agencies and their role in the present mess. Investors … Continue reading →

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Zhang’s High

Posted on September 26, 2007 by Felix

My friends don’t tend to collect art, but it seems that their friends do. Yesterday afternoon, I found out that a friend of a friend had sold his Zhang Xiaogang at Sotheby’s for $400,000; and then yesterday evening I found … Continue reading →

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How Giving to Charity Will Help You Get Rich Quick

Posted on September 26, 2007 by Felix

On Monday, I met Jim Whitton, a director of The Hunger Project, in a midtown cafe. The Hunger Project (THP) is a well-run non-profit which works efficiently and tirelessly towards sustainable poverty reduction in the developing world. With Whitton was … Continue reading →

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Subprime: It’s Not About Creditworthiness

Posted on September 26, 2007 by Felix

A bit of a late start this morning, thanks to a Portfolio breakfast (of which more later) hosted by Jesse Eisinger on the subject of the subprime meltdown. Joe Mason of Drexel University was there, and was very rude about … Continue reading →

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Angus Maddison’s New Book

Posted on September 25, 2007 by Felix

I have very few books in my office, which is quite small, but in pride of place on my reference shelf stands Angus Maddison’s masterful reference work "The World Economy". No one has spent more time or effort trying to … Continue reading →

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The Price of Luxury

Posted on September 25, 2007 by Felix

The Economist notes the evolution of the economics of luxury goods over the past year: while the goods themselves have increased in price by 6%, twice the rate of inflation, the income of the rich has increased by 9%, or … Continue reading →

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Bonds Without Price Quotes

Posted on September 25, 2007 by Felix

Paul Kedrosky has found a Greenwich Associates report saying that "more than 60% of participants active in corporate bonds say they have experienced trouble getting a simple price quote from dealers on these usually liquid products". Is this, as he … Continue reading →

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Intellectual Property Among Magicians

Posted on September 25, 2007 by Felix

In my Q&A with Susan Scafidi, I asked about Jim Surowiecki’s assertion that the world of magic tricks manages to be innovative despite a lack of copyright protection. Susan replied that there might be no copyright protection, but that didn’t … Continue reading →

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Labor Market Datapoint of the Day

Posted on September 25, 2007 by Felix

Bo Peabody’s companies pay their ad sales staff well, it would seem: Digital ad sales at the entry level are getting multiple six figure salaries. I tried checking this with my friendly neighborhood digital entrepeneur, who told me that a … Continue reading →

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Why the GM Strike Makes Sense

Posted on September 25, 2007 by Felix

The GM strike makes sense to me. The key issue for the union, quite properly, is the jobs of its members. The last time the UAW went on national strike, in 1970, it had 400,000 members; now, it has 73,000. … Continue reading →

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Mortgage Prepayment: Economically Suboptimal

Posted on September 25, 2007 by Felix

Greg Mankiw reckons that prepayment penalties are a Bad Thing, and approves of David Laibson’s plan to abolish them. Writes Mankiw: When I refinanced my mortgage not long ago, one of my first questions was, Are there any prepayment penalties? … Continue reading →

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Speculation in Art

Posted on September 24, 2007 by Felix

Callen Bair, responding to my post on speculative bubbles, tells me that there is speculation in the art market after all. Who are these speculators? They’re rich; they want to spend their money; and it might as well be on … Continue reading →

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Subprime: Reasons to be Thankful

Posted on September 24, 2007 by Felix

Ten years ago, the GBP/USD exchange rate was 1.61. Today, it’s 2.02. Over that timeframe, the Economist tells us, UK housing prices have risen by 211%, compared to just 120% in the US. Which means that in dollar terms, UK … Continue reading →

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Welcome Econospeak

Posted on September 24, 2007 by Felix

I’m late to this game, I know, but in the wake of links from Mark Thoma, Tyler Cowen, and Megan McArdle, let me be the latest to welcome Econospeak to the blogosphere. Anybody who will join me in defending cap-and-trade … Continue reading →

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In Defense of Credit Derivatives

Posted on September 24, 2007 by Felix

You can always tell when the newsflow slows down in the financial world, because invariably some columnist will trot out another brave reëvaluation of credit derivatives. Here’s Scott Patterson: The power of these derivatives — most of which were launched … Continue reading →

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Headline of the Day

Posted on September 24, 2007 by Felix

The Publisher of Forbes Magazine, a Regular on Fox, Blames the Mortgage Meltdown on Sex Ed Yes, really. (Via Dealbreaker)

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USA 2008 as Russia 1998

Posted on September 24, 2007 by Felix

Now here’s an interesting recipe for growth: how does utter financial collapse and skyrocketing inflation sound? Writes the Grouse today: When the Russian debt markets blew up, there was a massive devaluation of the ruble, which made it hard for … Continue reading →

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The Oil Price Denomination Fallacy

Posted on September 24, 2007 by Felix

Repeat after me: The fact that oil prices are denominated in dollars means… absolutely nothing. Dean Baker has been banging this drum for a few days now, most recently attacking the Washington Post for saying that "since crude oil is … Continue reading →

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Four Reasons Why Time Warner Might Not Spin Off Time Inc

Posted on September 24, 2007 by Felix

Sean Elder kicks off his guest-blogging stint over at Mixed Media in fine style this morning, with the story that Time Warner is thinking about an IPO of its magazine-publishing arm, Time Inc. I’m not convinced this will happen, for … Continue reading →

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