Daily Digest

Image by Philip Jagenstedt, Flickr Creative Commons

Daily Digest 2/8 - Conquering China's Mountain Of Debt, Does Finance Do Society Any Good?

Sunday, February 8, 2015, 12:04 PM

Economy

Is Buying a House Still the Best Way to Build Wealth? (jdargis)

That's why economists and policymakers worry so much about the fact that the housing market has yet to fully recover. Credit has become so tight that borrowers who may have enough income to cover their costs, but who do not have perfect credit scores, remain locked out of the market. And, fewer Americans in the aftermath of the global financial recession are creating new households, opting instead to bunk with family and friends.

Greek Austerity Spawns Fakery: Playing Nurse (jdargis)

Greece’s dire finances have gutted its health care system. Universal coverage effectively ended under the austerity measures imposed under the terms of the country’s bailout. Budget cuts have also thinned the ranks of hospital staff nurses, who are supposed to handle medical tasks like changing IVs.

The powerful cheat for themselves, the powerless cheat for others (jdargis)

To look into this issue, the researchers conducted a series of experiments manipulating different variables. In the first, they surveyed 151 participants to determine their social class. These individuals then participated in a computer-based die-rolling game, where the goal was to achieve a total of more than 14 from rolling a die five times. Winners were told they would be entered into a lottery for a $50 gift card. The virtual die was programmed to always add up to 12, but participants were not monitored, so they were able to lie about their results—any participant who reported rolling a total of more than 14 was clearly cheating.

Conquering China's Mountain Of Debt (jdargis)

Ever since China’s last major fiscal reform in the mid-1990s, when then-Vice Premier Zhu Rongji restored control of public finances to the national government, local governments have faced a dilemma. They receive only about half of China’s total tax revenue, while they must pay for 80 percent of all government expenses, including schools, roads, and health care. The local governments are banned from borrowing directly from banks and from issuing bonds.

Does Finance Do Any Good for Society? (jdargis)

In a National Bureau of Economics working paper published earlier this week, he expanded on how economists might try to bridge this gap between their views and public opinion. I spoke with Zingales about his paper, and, among other things, we talked about the press's diminishing role in shaping how economists and the public converse with each other and about whether skepticism toward bankers is a uniquely American phenomenon. The interview that follows has been edited and condensed for the sake of clarity.

If you think gas is cheap these days, look what it costs in Saudi Arabia (jdargis)

Remember all those $60 fill-ups at U.S. pumps when gas was running close to $4 a gallon over the past few years? While your wallet was getting hammered, Saudi Arabia’s was getting stuffed thick. The kingdom has more than $750 billion in cash reserves, which is more than enough to keep the lights on and stave off panic over oil markets.

China Tries a New Tactic to Combat Pollution: Transparency (jdargis)

The mayor’s most recent dose of real talk followed an announcement that Beijing had failed to meet its 2014 target of a five-per-cent reduction in the average annual concentration of tiny particulate matter, known as PM2.5. Levels did decline, but only by four per cent. The announcement didn’t mention that levels of large particulate matter, PM10, actually increased by 7.1 per cent in the same year. This was after the central government had unveiled a two-hundred-and-seventy-seven-billion-dollar plan to fight pollution, in mid-2013, and after Beijing itself had allocated a hundred and twenty-one billion dollars, at the beginning of 2014. The news was a reminder that, even as the capital has stepped up its anti-smog efforts, livability may be a long way off.

How to Use Up Every Single Molecule of Your CSA (jdargis)

First, I'm making an oil tanker of soup. Found this hearty turnip and carrot soup recipe, which looks like it'll burn through the produce. Turns out I've got everything except rutabaga, which is upsetting, because after kale, rutabaga is the other thing you get too much of from the CSA. Hell, I even have the leeks, and who in their right mind has leeks sitting around?

Gold & Silver

Click to read the PM Daily Market Commentary: 2/6/15

Provided daily by the Peak Prosperity Gold & Silver Group

Article suggestions for the Daily Digest can be sent to [email protected]. All suggestions are filtered by the Daily Digest team and preference is given to those that are in alignment with the message of the Crash Course and the "3 Es."

9 Comments

KugsCheese's picture
KugsCheese
Status: Diamond Member (Offline)
Joined: Jan 2 2010
Posts: 1449
Re: The powerful cheat for themselves

If you have low income, you depend on more cooperation to survive.  This does not mean less cheating.  In fact, it may mean more cheating but the article did not publish cheating rates.  Think USSR.  You can be selfish by doing someone else a "favor" if expect a future "favor" in return.   All action is selfish.

saxplayer00o1's picture
saxplayer00o1
Status: Diamond Member (Online)
Joined: Jul 30 2009
Posts: 4169
Denny Johnson's picture
Denny Johnson
Status: Gold Member (Offline)
Joined: Aug 13 2008
Posts: 348
Ukraine fiasco

Take it with a grain of salt, it's from ZH, but here's a summary of lotsa new cracks around the Ukraine fiasco.

Hopefully some pragmatism starting to surface.

http://www.zerohedge.com/news/2015-02-08/europe-fractures-france-pivots-putin-cyprus-offers-moscow-military-base-germany-us-s

thc0655's picture
thc0655
Status: Diamond Member (Offline)
Joined: Apr 27 2010
Posts: 1632
Greenspan in truth-telling mode on Greece, Eurozone

Greenspan says Greece will have to exit the Euro and that the Euro zone won't be able to survive it.  Where was all this truth-telling from him when he was Fed Chairman?

http://www.bbc.com/news/business-31249907?ocid=socialflow_twitter

Mr Greenspan, chairman of the Federal Reserve from 1987 to 2006, said: "I believe [Greece] will eventually leave. I don't think it helps them or the rest of the eurozone - it is just a matter of time before everyone recognises that parting is the best strategy.

There is "no advantage" in lending to Greece according to Alan Greenspan

"The problem is that there there is no way that I can conceive of the euro of continuing, unless and until all of the members of eurozone become politically integrated - actually even just fiscally integrated won't do it."

Arthur Robey's picture
Arthur Robey
Status: Diamond Member (Offline)
Joined: Feb 4 2010
Posts: 3936
Shifting morality.

After the second world war, the USA did not want to deal with the complex mess that is Europe, so they engineered the whole Euro concept to make the East Asian Peninsula manageable. France insisted Britain  only be allowed in once it had divested itself of it's colonies.

The second world war is a fading memory. It seems to me that a more natural alliance would be towards the rest of Eurasia for the individual European states.

The USA managed to win the war (Russian Laughter in background), because of it's indigenous oil. That oil is gone.

Personally I believe that all sides were played against each other by people who had vast fortunes to be made. My friend Jack Veenendaal was in Holland during the bombing. He said that the residential areas were bombed until the very bricks bounced, but only one bomb hit the Philips factory. And it must have been a mistake.

As an ex soldier my advice when forced to war sell yourself to the highest bidder. "Wots innit for me? "  Any other attitude marks you as a Patsy.

HughK's picture
HughK
Status: Platinum Member (Offline)
Joined: Mar 6 2012
Posts: 761
Did Blackwater (Academi) guard the Greek parliament?

A colleague forwarded me this blog post, based on a  linked article from the Danish press.  I haven't had time to give it a close read, but I thought I'd pass it along.  It's from 2013.

Private mercenary army to protect the Greek parliament against rebellion

 

KugsCheese's picture
KugsCheese
Status: Diamond Member (Offline)
Joined: Jan 2 2010
Posts: 1449
Greek Derivative Value?

 

What is the derivative value connected to Greece Exit?

KugsCheese's picture
KugsCheese
Status: Diamond Member (Offline)
Joined: Jan 2 2010
Posts: 1449
thc0655 wrote: Greenspan says
thc0655 wrote:

Greenspan says Greece will have to exit the Euro and that the Euro zone won't be able to survive it.  Where was all this truth-telling from him when he was Fed Chairman?

http://www.bbc.com/news/business-31249907?ocid=socialflow_twitter

Mr Greenspan, chairman of the Federal Reserve from 1987 to 2006, said: "I believe [Greece] will eventually leave. I don't think it helps them or the rest of the eurozone - it is just a matter of time before everyone recognises that parting is the best strategy.

There is "no advantage" in lending to Greece according to Alan Greenspan

"The problem is that there there is no way that I can conceive of the euro of continuing, unless and until all of the members of eurozone become politically integrated - actually even just fiscally integrated won't do it."

 

Centralizer Flattery seems to get him.  He is now big on gold again too.

TechGuy's picture
TechGuy
Status: Gold Member (Offline)
Joined: Oct 13 2008
Posts: 428
Probably Bogus study

I am enclined to believe this study is bogus. There was nothing to determine if the participated lied about their social status. Its very likely that the cheaters also cheated about there status which would render the study bogus. I doubt anyone that is "well off" would bother to participe for $50 prize. It would not be worth their time.

FWIW: Most westerns tried to appear much better off than they really are as most of them buy expensive and flashy items (cars, homes, jewerly). I even see poor people do this. 

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Login or Register to post comments