Finance India

  <p>Dear readers,</p> <p>Given the fantastic feedback and massive requests for more Hyman Minsky material I decided to compile a list of free research papers (and corresponding abstracts)that you can download below.</p> <p>Best,</p> <p>Miguel Barbosa</p> <p>1. <a href="http://papers.ssrn.com/sol3/papers.cfm?abstract_id=161024"><strong>The Financial Instability Hypothesis - Via SSRN - (Click Here To Download This Paper)</strong></a></p> <p>The Financial Instability Hypothesis (FIH) has both empirical and theoretical aspects that challenge the classic precepts of Smith and Walras, who implied that the economy can be best understood by assuming that it is constantly an equilibrium-seeking and sustaining system. The theoretical argument of the FIH emerges from the characterization of the economy as a capitalist economy with extensive capital assets and a sophisticated financial system.  In spite of the complexity of financial relations, the key determinant of system behavior remains the level of profits: the FIH incorporates a view in which aggregate demand determines profits. Hence, aggregate profits equal aggregate investment plus the government deficit. The FIH, therefore, considers the impact of debt on system behavior and also includes the manner in which debt is validated.  Minsky identifies hedge, speculative, and Ponzi finance as distinct income-debt relations for economic units. He asserts that if hedge financing dominates, then the economy may well be an equilibrium-seeking and containing system: conversely, the greater the weight of speculative and Ponzi finance, the greater the likelihood that the economy is a &#8220;deviation-amplifying&#8221; system. Thus, the FIH suggests that over periods of prolonged prosperity, capitalist economies tend to move from a financial structure dominated by hedge finance (stable) to a structure that increasingly emphasizes speculative and Ponzi finance (unstable). The FIH is a model of a capitalist economy that does not rely on exogenous shocks to generate business cycles of varying severity: business cycles of history are compounded out of (i) the internal dynamics of capitalist economies, and (ii) the system of interventions and regulations that are designed to keep the economy operating within reasonable bounds.</p> <p><strong>2. <a href="http://papers.ssrn.com/sol3/papers.cfm?abstract_id=171533">Financial Crises: Systemic or Idiosyncratic - Via SSRN (Click Here To Download This Paper)</a></strong></p> <p>The presentations at this conference are by economists from Academies and economists who professionally confront real world problems, either in private finance or in public policy. As economists we accept that the remarks made by Keynes in the closing passage of The General Theory are true: &#8220;&#8230; the ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist. &#8230;. I am sure the power of vested interests is vastly exaggerated compared with the gradual encroachment of ideas. &#8230; Soon or late it is ideas, not vested interests, which are dangerous for good or evil.&#8221; We like this assertion not only because it makes us important but also because it makes good sense. The ideas that Keynes refers to are theories. A theory prior for rational action. A of system behavior is a proposed action, whether by individual agents in households or firms, a bank, a government agency or a legislative body is appropriate action only as a theory connects the action to the desired result. Because some institutions, such as deposit insurance, the savings and loan industry, and a number of the great private banks, that served the economy well during the first two generations after the great depression, seem to have broken down, the need to reform and to reconstitute the financial structure is now on the legislative agenda. As we try to fix the financial system three questions should be asked of the pushers of a policy proposal: 1. &#8220;What is it that is taken to be broke?&#8221;, 2. &#8220;What theory about proposal?&#8221; 3. What are the dire consequences of not fixing that which you assert is broke? In what follows I will take up three points 1. Two views of the results of the economic process 2. Systemic and idiosyncratic sources of financial crises 3. Some ideas about the scope for policy in the present &#8220;crisis&#8221;.</p> <p><strong>3. <a href="http://papers.ssrn.com/sol3/papers.cfm?abstract_id=141121">Finance and Stability: The Limits of Capitalism Via SSRN (Click Here To Download This Paper)</a></strong><br /> Once again the United States economy is facing a crisis, resolution of which first requires the realization that there are many types of capitalism: Solutions implemented in the past, therefore, may or may not be an appropriate solution today, as they could have been implemented as an answer to a problem posed within the context of a different model. Alternatively, the solution may lie in the implementation of a totally new economic regime in answer to reoccurring problems inherent in capitalism in general. The implementation of a new model is not a unique happening in United States economic history. The interventionist model&#8211;set in motion by President Roosevelt in answer to the failure of the laissez-faire model in the 1930s&#8211;dealt with the obvious flaw inherent in capitalism in general, namely, its inability to maintain a level of aggregate demand consistent with full employment. Implementation of the interventionist model prevented a massive depression of the type experienced in the 1930s from being repeated due to the larger role played by the government sector in maintaining demand via active fiscal policy, while moderating inflation through the use of monetary policy. The interventionist model also recognized the less obvious, deeper flaw of capitalism&#8211;namely, the manner in which the financial system can adversely affect the price of assets relative to that of current output. Absent any interventionist policy, the resulting decline in private investment and profits leads to a downward spiral and collapse of the financial sector. The institutional roadblocks included in the interventionist model were sufficient to avert large disequilibriums in asset and output prices, thereby sustaining profits and precluding a deep recession. (Indeed, the Federal Reserve was not forced to act to avert a financial crisis until 1968, when problems arose in the commercial paper market.) The interventionist model, however, was abrogated during the 1980s with the reinstitution of a new laissez-faire model. The new model eliminated many of the restrictions imposed on financial sector, massive increases in national deficits through unproductive public sector spending (made even more inefficient by the resulting interest on the debt), and the growth of speculative financing schemes that left us with too many highly indebted firms. A large, financially induced depression was contained only through the reintroduction of massive governing monetary and fiscal intervention in the form of the S&amp;L bailout and the maintenance of profits with massive deficits. Although the subsequent drop in interest rates has resulted in a rise in asset values and somewhat abated the turmoil in the financial markets, the economy continues to stagnate.</p> <p><strong>4. <a href="http://papers.ssrn.com/sol3/papers.cfm?abstract_id=100888">Financial Instability and the Decline of Banking: Public Policy Implications</a> - <a href="http://papers.ssrn.com/sol3/papers.cfm?abstract_id=100888">Via SSRN (Click Here To Download The Paper)</a></strong></p> <p>Banking plays two roles in a modern capitalist economy: It provides a means of payment and channels resources into capital development. These functions are being performed to a decreasing extent by banks, and it appears that this trend will continue. Such developments suggest that the economic role of central banks needs to be reviewed because the role of banks is significant in the ability of the central bank to conduct monetary policy. This ability is changing due the transformation of the channels through which Federal Reserve operations affect the economy away from affecting the availability or cost of financing and toward affecting uncertainty, the evaluation by portfolio managers of the viability of enterprises, and the stability of markets. When central bank operations affect the uncertainty of financial market agents, market reactions will often be out of proportion to the size of the operation.</p> <p><strong>5. <a href="http://papers.ssrn.com/sol3/papers.cfm?abstract_id=179455">The Transition to a Market Economy: Financial Options - Via SSRN (Click Here To Download The Paper)</a></strong><br /> The social transformation of Eastern Europe has proceeded much faster, and the destruction of communism&#8217;s legitimacy and efficacy has been more complete, than was deemed possible even a few years ago. A common tenet among the economies now emerging from communism is the lack of significant private wealth, even though there are capital assets that are used in production and have the potential to generate profits. However, since there is no relevant history of profits in the emerging economies, there is no way to meaningfully assess values of capital assets. The financial system provides for linkages through time: Exchanges of money for well-defined claims to future-money flow are made daily. Thus, the financial structure and the physical capital assets of a capitalist economy link the present and the past to the future. The options available to the emerging economies with respect to their financial structure are limited-the lack of significant private wealth leads to weak market for financial instruments and poor prospects for market-based financing. The initial choice of a financial structure is constrained to universal banks or public holding companies. Special venture capital holding companies and local independent banks should be integrated into the financial structure to facilitate entrepreneurial spirit. The public holding company is favored as a transitional instrument to foster the development of information and private wealth, and should be modeled after the Reconstruction Finance Corporation of the New Deal era.</p> <p><strong>6.<a href="http://papers.ssrn.com/sol3/papers.cfm?abstract_id=161469"> The Capitalist Development of the Economy and the Structure of Financial Institutions - Via SSRN (Click Here To Download The Paper) </a></strong><br /> This paper evolves from the sharp contrast in Smithian and Keynesian views about the relationship between the financial structure and the economy. The Smithian perspective implies that the financial structure is irrelevant, whereas the Keynesian position concludes that effective financing is necessary for the &#8220;capital development of the economy&#8221;- there is also a need to constrain any tendency of what Keynes referred to as speculation to dominate. Thus, the essential elements of equilibrium in Keynesian theory, the financial theory of investment and the investment theory of business cycles, are most apt when examined as outcomes of processes that operate over time. During the 1980s, there was a sharp increase in speculative financing resulting from the trend toward leveraged buyouts and the rising demand for short-term marketable corporate liabilities. A main characteristic of a capitalist economy that is stagnant or immersed in a depression is that the capital development of the economy is not progressing. The 1980s were filled with examples of financing inept investments, while the current climate is one of grossly inadequate investment levels to create a progressive full-employment economy. The financial instability interpretation of Keynes rests upon the profitability of debt financing, and incorporates the potential collapse of asset values in an environment of speculative and Ponzi financing. Consequently, the financial structure is significantly more fragile today than earlier in the post World War II era.</p> <p><strong>7.<a href="http://papers.ssrn.com/sol3/papers.cfm?abstract_id=161596"> Reconstituting the United States&#8217; Financial Structure: Some Fundamental Issues -Via SSRN (Click Here To Download The Paper)</a></strong></p> <p>Deposit insurance, the savings and loan industry, facets of the insurance industry, and a significant number of private banks have all been plagued by recent collapse. The legislative agenda goes beyond merely funding the shortfall in deposit insurance funds: Congress has suggested that reforming the deposit insurance function, as well as the associated regulatory and supervisory structure, is imperative to avoid a recurrence of Treasury financing. An assessment of the problem, and also the prescriptions for a cure, rest on the particular theoretical perspective of the observer. The Smithian view asserts that markets always lead to the promotion of public welfare, while Keynesian theory states that market processes may lead to malfunction of the capital development of the economy-that is, something other than the promotion of public welfare. For example, the crisis in finance during 1991 is largely a delayed response to the experiment in practical monetarism that occurred from 1979 to 1982. In typically simplistic fashion, monetarism suggests that inflation is always the result of too much money chasing too few goods: Hence, controlling inflation rests on controlling money supply. The fundamental flaw in the Bush administration&#8217;s proposals is that they subscribe to a Smithian theme. They impute the problems afflicting the finance industry (e.g. lack of capital development of the economy) to a minor flaw in the institutional structure rather than to basic characteristics of the economy. The recommendations submitted in the paper are inherently distinct from the administration&#8217;s proposal and have evolved from a Keynesian model of the economy specifying the processes and determinants of the performance of the economy.</p> <p><strong>8. <a href="http://papers.ssrn.com/sol3/papers.cfm?abstract_id=8659">Uncertainty and the Institutional Structure of Capitalist Economies - Via SSRN (Click Here To Download The Paper) </a></strong><br /> In this working paper Distinguished Scholar Hyman P. Minsky explores the theoretical and practical causes of today&#8217;s rising economic uncertainty and insecurity. He begins by noting views of uncertainty held by Keynes and adherents of the new classical economics by comparing Keynes&#8217; The Treatise on Probability and Sargent&#8217;s Bounded Rationality in Macroeconomics. According to both views, decisions are made by agents based on varying degrees of ignorance and supposition; the agents have a more or less limited amount of knowledge and base their judgements on their own idea of how the economy works (their &#8220;model of the model&#8221;). In addition, agents are not homogeneous but have differing abilities and histories. Thus the internal models used to guide decisions are not consistent from agent to agent. Minsky notes that although according to Sargent&#8217;s concept of bounded rationality all agents at any one time need not be acting according to mutually consistent models, Sargent ignores a point stressed by Keynes about the decision-making process: Economic events at any one time are the result of past mental models (and corresponding actions and expectations), and those past models are different from current models (and correspondingly different actions and expectations); therefore, factors that might determine long-term expectations are in a continuous state of flux. Despite this difference, the gap between the ideas of the two schools of thought have narrowed. Minsky points out that capitalism in the United States is an ever-evolving construct that recently entered a new stage: money manager capitalism. In this form of capitalism, nearly all businesses are organized as corporations; pension and mutual funds are the predominant owners of financial assets; and managers of these funds are judged solely on the total return on fund assets (dividends and interest plus appreciation in share value). One consequence of the money manager structure is predominance of short-run considerations in decision making.��Historically, the public has had limited tolerance for uncertainty. During the New Deal era this intolerance led to the creation of institutions and arrangements to reduce uncertainty and create transparency in both financial markets and corporate governance. For example, crop insurance set floors to farmers&#8217; incomes, and deficits run by the federal government set floors to aggregate profit flows. However, the focus of money manager capitalism on short-run returns and uncompromised profit margins has increased economic uncertainty at the firm and plant levels through the chronic need to reduce overhead and variable costs. These activities have unraveled the traditional relationships between firms and workers and increased economic insecurity among employees. Minsky asserts that since existing institutions and arrangements cannot contain this uncertainty, new institutions and arrangements must be created to offset the effects felt by the &#8220;losers&#8221; in the gamble imposed by uncertainty. Such measures are necessary to prevent these individuals from becoming alienated and hence recruits for an alternative to democracy. Accepting the view of Henry Simons that the focus of economic policy is not narrowly the economy but rather to &#8220;assure that the economic prerequisites for sustaining the civil and civilized standards of an open liberal society exist,&#8221; Minsky suggests that full employment programs analogous to certain New Deal programs (the Works Progress Administration, the Civilian Conservation Corps, and the National Youth Administration, for example) should be considered to meet these goals.��How would such programs be financed? According to Minsky, the U.S. economy has ample resources, but the question is one of how willing we are to mobilize these resources, that is, to tax and borrow for such projects. For example, welfare in its current form (AFDC and food stamps) exists because it is the cheapest way (short of a policy of doing nothing at all) to take that ratio care of the population in need. Full employment policies are more humane but more expensive and require a larger and more innovative public sector. For government to institute programs to offset the uncertainties of money manager capitalism, it must validate government debt with government revenues. The current high rate of government debt to gross domestic product (GDP) is the result of the irresponsible fiscal policies of the 1980s; a responsible program would assure the decline of the ratio of federal debt to GDP over time from its current 65 percent to about 50 percent. The reduction could be accomplished by transforming the tax structure to a value-added revenue system in which, for example, the individual income tax is replaced by a progressive consumption tax with broad bands and a high per person deduction and value-added taxes are levied on production or distribution and on imports. Imposing such a revenue system would allow the United States to transform its economy from one based on transfer payments to a full employment economy, from one that generates resentment to one that maintains commitment to democracy.</p>

Posted by Miguel on July 03, 2009 02:06 AM · permalink

  <p>Recently I linked to several articles which are quite critical of Nassim Taleb. Now its time to post some positive content .</p> <p>The following video was linked on the Farnam Street blog. (Great job FS)<br /> <strong><a href="http://www.youtube.com/watch?v=LZZYZqBUwos&amp;feature=player_embedded">Watch The Video Below Or Click Here For Our Email/Rss Readers</a></strong></p> <p><object width="425" height="344" data="http://www.youtube.com/v/LZZYZqBUwos&amp;rel=0&amp;color1=0xb1b1b1&amp;color2=0xcfcfcf&amp;hl=en&amp;feature=player_embedded&amp;fs=1" type="application/x-shockwave-flash"><param name="allowFullScreen" value="true" /><param name="allowScriptAccess" value="always" /><param name="src" value="http://www.youtube.com/v/LZZYZqBUwos&amp;rel=0&amp;color1=0xb1b1b1&amp;color2=0xcfcfcf&amp;hl=en&amp;feature=player_embedded&amp;fs=1" /><param name="allowfullscreen" value="true" /></object></p>

Posted by Miguel on July 03, 2009 01:04 AM · permalink

  <p style="text-align: left;">A teaspoon of Mises a day keeps inflation at bay.</p> <p style="text-align: center;"><a href="http://mises.org/story/3525"><strong>Click Here To Read Mises.Org&#8217;s Analysis Of Inflation</strong></a></p> <p><strong>Introduction (Via Mises.Org)</strong></p> <p>The Federal Reserve is lying about the nation&#8217;s money supply (M1). The current figure for money supply is being given as $1.6 trillion. The actual number is $2.34 trillion. The reported number is equivalent to an increase of 16% over the past year. The actual number is equivalent to an increase of 70% over the past year. This compares with the nation&#8217;s high money-supply increase of 16.9% in 1986.</p> <p><strong>Excerpts (Via Mises.Org)</strong></p> <p>However, the monetary base is a <em>part</em> of the money supply. How can the part exceed the whole? (Money is created in 2 basic steps. First, the Federal Reserve prints up paper money. This is called special money and is usable by private banks as reserves. It is treated in the system in the way gold used to be. This money is measured by Federal Reserve credit, or Reserve Bank credit. With a few adjustments, this becomes the monetary base, which can be thought of as the special money that is available to the banking system for the second step. In the second step, the private banks create money in the form of demand, and other checkable, deposits. They do this in the process of making loans. Essentially, the nation&#8217;s money supply is cash — the special money — plus bank deposits.)</p> <p>Last year practically every newspaper in the country was telling you that the problem we faced was &#8220;deflation.&#8221; That was a gigantic piece of propaganda designed to frighten you into holding cash. Remember the flight to &#8220;safety&#8221; into T-bills and T-bonds? Most people fled from hard assets. These are the victims. They believed the propaganda of the establishment. When the debris of our collapsing society starts to come down, they will be its victims. Their assets will be &#8220;safe&#8221; in the US dollar as it loses its place as the world&#8217;s reserve currency.</p> <p style="text-align: center;"><a href="http://mises.org/story/3525"><strong>Click Here To Read Mises.Org&#8217;s Analysis Of Inflation</strong></a></p>

Posted by Miguel on July 02, 2009 09:06 PM · permalink

  <p>More interesting comments on the health care part of the video. Enjoy!</p> <p><strong>Introduction (Via CNN)</strong><br /> Paul Krugman and John B. Taylor debate the origins of the financial crisis and the proposed health care plan.<br /> <strong><a href="http://economistsview.typepad.com/economistsview/2009/07/video-krugman-and-taylor.html">Watch The Video Below Or Click Here FOr Our Email/Rss Subscribers</a></strong><br /> <script src="http://i.cdn.turner.com/cnn/.element/js/2.0/video/evp/module.js?loc=dom&amp;vid=/video/bestoftv/2009/06/28/gps.krugman.taylor.econ.cnn" type="text/javascript"></script><noscript>Embedded video from &amp;lt;a href=&#8221;http://www.cnn.com/video&#8221; mce_href=&#8221;http://www.cnn.com/video&#8221;&amp;gt;CNN Video&amp;lt;/a&amp;gt;</noscript></p>

Posted by Miguel on July 02, 2009 09:00 PM · permalink

  <p>My friend James Montier would probably agree that time spent reading Minsky or <span id="main" style="visibility: visible;"><span id="search" style="visibility: visible;">Kindleberger would save investors from making foolish mistakes.<br /> </span></span></p> <p><strong>Background </strong>(Via Wikipedia)</p> <p>Hyman Minsky was an American economist and professor of economics at Washington University in St. Louis. His research attempted to provide an understanding and explanation of the characteristics of financial crises. Minsky was sometimes described as a <span class="mw-redirect">post-Keynesian economist</span>, because, in the <span class="mw-redirect">Keynesian</span> tradition, he supported some government intervention in financial markets and opposed some of the popular deregulation policies in the 1980s, and argued against the accumulation of debt. His research, nevertheless, endeared him to Wall Street.</p> <p><strong>Excerpt Of Minsky&#8217;s Contributions </strong>(Via Wikipedia)</p> <p>Dr. Minsky proposed theories linking financial market fragility, in the normal life cycle of an economy, with speculative <span class="mw-redirect">investment bubbles</span> endogenous to financial markets. Minsky claimed that in prosperous times, when corporate cash flow rises beyond what is needed to pay off debt, a speculative euphoria develops, and soon thereafter debts exceed what borrowers can pay off from their incoming revenues, which in turn produces a financial crisis. As a result of such speculative borrowing bubbles, banks and <span class="mw-redirect">lenders</span> tighten credit availability, even to companies that can afford loans, and the economy subsequently contracts.</p> <p><a style="margin: 12px auto 6px auto; font-family: Helvetica,Arial,Sans-serif; font-style: normal; font-variant: normal; font-weight: normal; font-size: 14px; line-height: normal; font-size-adjust: none; font-stretch: normal; -x-system-font: none; display: block; text-decoration: underline;" title="View Minsky Stabilizing an Unstable Economy Complete on Scribd" href="http://www.scribd.com/doc/11626149/Minsky-Stabilizing-an-Unstable-Economy-Complete">Minsky Stabilizing an Unstable Economy Complete</a> <object width="399" height="502" data="http://d.scribd.com/ScribdViewer.swf?document_id=11626149&amp;access_key=key-227uak7njlce52kshq5n&amp;page=1&amp;version=1&amp;viewMode=" type="application/x-shockwave-flash"><param name="id" value="doc_587574868042846" /><param name="name" value="doc_587574868042846" /><param name="align" value="middle" /><param name="quality" value="high" /><param name="play" value="true" /><param name="loop" value="true" /><param name="scale" value="showall" /><param name="wmode" value="opaque" /><param name="devicefont" value="false" /><param name="bgcolor" value="#ffffff" /><param name="menu" value="true" /><param name="allowFullScreen" value="true" /><param name="allowScriptAccess" value="always" /><param name="src" value="http://d.scribd.com/ScribdViewer.swf?document_id=11626149&amp;access_key=key-227uak7njlce52kshq5n&amp;page=1&amp;version=1&amp;viewMode=" /><param name="allowfullscreen" value="true" /></object></p> <p><a style="margin: 12px auto 6px auto; font-family: Helvetica,Arial,Sans-serif; font-style: normal; font-variant: normal; font-weight: normal; font-size: 14px; line-height: normal; font-size-adjust: none; font-stretch: normal; -x-system-font: none; display: block; text-decoration: underline;" title="View Crisis and History on Scribd" href="http://www.scribd.com/doc/9070013/Crisis-and-History">Minsky On Crisis and History</a> <object width="401" height="502" data="http://d.scribd.com/ScribdViewer.swf?document_id=9070013&amp;access_key=key-v7lj0cbpbgm31sgoh4y&amp;page=1&amp;version=1&amp;viewMode=" type="application/x-shockwave-flash"><param name="id" value="doc_824805741704537" /><param name="name" value="doc_824805741704537" /><param name="align" value="middle" /><param name="quality" value="high" /><param name="play" value="true" /><param name="loop" value="true" /><param name="scale" value="showall" /><param name="wmode" value="opaque" /><param name="devicefont" value="false" /><param name="bgcolor" value="#ffffff" /><param name="menu" value="true" /><param name="allowFullScreen" value="true" /><param name="allowScriptAccess" value="always" /><param name="src" value="http://d.scribd.com/ScribdViewer.swf?document_id=9070013&amp;access_key=key-v7lj0cbpbgm31sgoh4y&amp;page=1&amp;version=1&amp;viewMode=" /><param name="allowfullscreen" value="true" /></object></p> <p><a style="margin: 12px auto 6px auto; font-family: Helvetica,Arial,Sans-serif; font-style: normal; font-variant: normal; font-weight: normal; font-size: 14px; line-height: normal; font-size-adjust: none; font-stretch: normal; -x-system-font: none; display: block; text-decoration: underline;" title="View Macroeconomics Meets Hyman P. Minsky the Financial Theory of Investment on Scribd" href="http://www.scribd.com/doc/7882315/Macroeconomics-Meets-Hyman-P-Minsky-the-Financial-Theory-of-Investment">Macroeconomics Meets Hyman P. Minsky the Financial Theory of Investment</a> <object width="399" height="502" data="http://d.scribd.com/ScribdViewer.swf?document_id=7882315&amp;access_key=key-26te64q63k5y0xety741&amp;page=1&amp;version=1&amp;viewMode=" type="application/x-shockwave-flash"><param name="id" value="doc_91220011294590" /><param name="name" value="doc_91220011294590" /><param name="align" value="middle" /><param name="quality" value="high" /><param name="play" value="true" /><param name="loop" value="true" /><param name="scale" value="showall" /><param name="wmode" value="opaque" /><param name="devicefont" value="false" /><param name="bgcolor" value="#ffffff" /><param name="menu" value="true" /><param name="allowFullScreen" value="true" /><param name="allowScriptAccess" value="always" /><param name="src" value="http://d.scribd.com/ScribdViewer.swf?document_id=7882315&amp;access_key=key-26te64q63k5y0xety741&amp;page=1&amp;version=1&amp;viewMode=" /><param name="allowfullscreen" value="true" /></object></p>

Posted by Miguel on July 02, 2009 07:44 PM · permalink

  <p>This is for the personal finance aficionados.</p> <p><strong>Introduction (Via Fama French Forum)</strong></p> <p>Does it make sense to dollar cost average? It depends. Standard financial analysis says dollar cost averaging is suboptimal. If you focus on only your investment outcome, investing a lump sum immediately lets you construct the best portfolio you can today; slowing the process with dollar cost averaging just keeps you in something other than your best portfolio until you are done. Behavioral finance provides a different perspective. Because of the difference between the way people react to errors of omission and errors of commission, dollar cost averaging may give investors a better expected investment experience.</p> <p><a href="http://www.dimensional.com/famafrench/2009/06/dollar-cost-averaging.html"><strong> Click On The Image Below To Watch The Video Or Click Here For Our Email/Rss Subscribers</strong></a></p> <p><a href="http://www.dimensional.com/famafrench/2009/06/dollar-cost-averaging.html"><img class="alignleft size-full wp-image-2661" title="Fama &amp; French" src="http://www.simoleonsense.com/wp-content/uploads/2009/07/ff.jpg" alt="Fama &amp; French" width="509" height="282" /></a></p>

Posted by Miguel on July 02, 2009 05:41 PM · permalink

  <p>A link to this Q&amp;A was sent to me by Lincoln Minor (Thanks buddy!)</p> <p style="text-align: center;"><a href="http://www.gurufocus.com/news.php?id=59450"><strong>Click Here To Read A Q/A With Super Investor Joel GreenBlatt</strong></a></p> <p><strong>Excerpts (Via Guru Focus)</strong></p> <p><strong>Question 1.</strong> While reading your biography or rather from what is available on the internet, I noticed you graduated in 1980 and founded Gotham in 1985. I was wondering what you did during that 5 year interim ? Did you work at a hedge fund or in banking, and if so in what area? (Bertrand)</p> <p><strong>Professor <a href="http://www.gurufocus.com/StockBuy.php?GuruName=Joel+Greenblatt">Joel Greenblatt</a> (JG):</strong> After graduating Wharton with an MBA in 1980, I decided to go to Law School to avoid taking a real job. After my first year, I decided that going to law school if you didn’t want to be a lawyer was perhaps not the best idea in the world. I took a job at a start-up hedge fund at the end of 1981 doing mostly risk arbitrage and special situation investing and started Gotham Capital in 1985.<br /> <strong>Question 7.</strong> It seems from your portfolio that you weren&#8217;t very active in the market in the past two years. You had a concentrated portfolio before and recently you came back with a very diversified portfolio in 2008. Then it seemed that you sold almost everything. Was it because you saw the crash coming? Why did you switch funds and can we invest in your new fund? If so, how? What do you see the market and the economy doing in the next few years? (charliet)</p> <p><strong>JG:</strong> Gee, this was lots of questions. Big picture: what gets publicly filed is very limited and does not give very much insight into what we are doing. We have many different funds with different ownership structures and that have different filing obligations. For example, we manage some long/short quantitative strategies where only the long side is subject to filing under certain circumstances. Some of our funds have allocations to sub-managers who occasionally make distributions in kind that are subject to filing (so securities we did not choose directly) and some funds hold investments not subject to filing requirements. So, looking at 13F’s or other public documents only provides a very narrow perspective into what we are doing and may often give very confusing or an incomplete view of the overall picture.</p> <p><strong>Question 10.</strong> Could you share your thinking about the relationship among long-term earnings stability, long-term ROE/ROIC and valuation levels (PE, PS)? How do you think about the dynamics of these three variables when valuating a company? (grol1971)</p> <p><strong>JG:</strong> When doing in depth analysis of companies, I care very much about long term earnings power, not necessarily so much about the volatility of that earnings power but about my certainty of “normal” earnings power over time. My goal is to buy a company at a low multiple to normal earnings power several years out and that the company earns good returns on capital at that level of normal earnings.</p> <p><strong>Question 17.</strong> Because free cash flow growth requires not only high returns on capital but also a reinvestment opportunity, have you explored adding a criterion to the screen that would indicate the presence of a significant opportunity for reinvestment? (jdt)</p> <p><strong>JG:</strong> I think this is a great question. The big picture is: the main thing you should be concerned about in the future are incremental returns on capital going forward. As it turns out, past history of a good return on capital is a good proxy for this but obviously not foolproof. I think this is an area where thoughtful analysis can add value to any simple ranking/screening strategy such as the magic formula. But keep in mind, buying a diversified portfolio of companies who have achieved high returns on capital in the past and that can be purchased at bargain prices has worked quite powerfully, buying an individual company without further analysis of this issue is another story.</p> <p style="text-align: center;"><a href="http://www.gurufocus.com/news.php?id=59450"><strong>Click Here To Read A Q/A With Super Investor Joel GreenBlatt</strong></a></p>

Posted by Miguel on July 02, 2009 08:00 AM · permalink

  <p>I agree with Taleb, wonderful things happen when you tinker around&#8230;.apparently this is also an important aspect of child education.</p> <h3>About this talk</h3> <p id="tagline">Gever Tulley uses engaging photos and footage to demonstrate the valuable lessons kids learn at his Tinkering School. When given tools, materials and guidance, these young imaginations run wild and creative problem-solving takes over to build unique boats, bridges and even a rollercoaster!</p> <h3>About Gever Tulley</h3> <p>The founder of the Tinkering School, Gever Tulley likes to build things with kids.</p> <p><strong><a href="http://www.ted.com/talks/gever_tulley_s_tinkering_school_in_action.html">Watch The Video Below Or Click Here For Our Rss Subscribers </a></strong><br /> <object width="446" height="326" data="http://video.ted.com/assets/player/swf/EmbedPlayer.swf" type="application/x-shockwave-flash"><param name="allowFullScreen" value="true" /><param name="wmode" value="transparent" /><param name="bgColor" value="#ffffff" /><param name="flashvars" value="vu=http://video.ted.com/talks/embed/GeverTulley_2009-embed_high.flv&amp;su=http://images.ted.com/images/ted/tedindex/embed-posters/GeverTulley-2009.embed_thumbnail.jpg&amp;vw=432&amp;vh=240&amp;ap=0&amp;ti=588" /><param name="src" value="http://video.ted.com/assets/player/swf/EmbedPlayer.swf" /><param name="bgcolor" value="#ffffff" /><param name="allowfullscreen" value="true" /></object></p>

Posted by Miguel on July 02, 2009 07:00 AM · permalink

  <p>I&#8217;m really impressed with SubsidyScope.com.  The Pew Charitable Trusts have really put together a brilliant website.</p> <p><strong>Introduction (Via SubsidyScope)</strong></p> <p>The estimated subsidy rate for transactions made under the Troubled Asset Relief Program has risen by 4 percent, according to a recent report by the Congressional Budget Office. In January, the CBO estimated the subsidy rate – the percentage of the initial TARP disbursement that reflects the true cost to the federal government of purchasing shares of stock from financial institutions – to be 32 percent, based on $293 billion in transactions. In a June 17 report, the CBO subsidy rate estimate rose to 36 percent, based on $439 billion in transactions. The new estimate includes assistance to the auto industry and $70 billion in repayments by TARP recipients.</p> <p><strong><a style="margin: 12px auto 6px auto; font-family: Helvetica,Arial,Sans-serif; font-style: normal; font-variant: normal; font-weight: normal; font-size: 14px; line-height: normal; font-size-adjust: none; font-stretch: normal; -x-system-font: none; display: block; text-decoration: underline;" title="View null on Scribd" href="http://www.scribd.com/doc/16922424/null">Click Here For The TARP: Report on Transactions Through June 17, 2009</a></strong> <object width="372" height="502" data="http://d.scribd.com/ScribdViewer.swf?document_id=16922424&amp;access_key=key-2g3zqgiqhgsol2ld9ngp&amp;page=1&amp;version=1&amp;viewMode=" type="application/x-shockwave-flash"><param name="id" value="doc_968365481297410" /><param name="name" value="doc_968365481297410" /><param name="align" value="middle" /><param name="quality" value="high" /><param name="play" value="true" /><param name="loop" value="true" /><param name="scale" value="showall" /><param name="wmode" value="opaque" /><param name="devicefont" value="false" /><param name="bgcolor" value="#ffffff" /><param name="menu" value="true" /><param name="allowFullScreen" value="true" /><param name="allowScriptAccess" value="always" /><param name="src" value="http://d.scribd.com/ScribdViewer.swf?document_id=16922424&amp;access_key=key-2g3zqgiqhgsol2ld9ngp&amp;page=1&amp;version=1&amp;viewMode=" /><param name="allowfullscreen" value="true" /></object></p>

Posted by Miguel on July 02, 2009 06:09 AM · permalink

  <p>This is post is dedicated to several VC friends who are interested in energy related topics</p> <p><strong>Introduction (Via Fora.Tv)</strong></p> <p>In this session presenters discuss the emergence of unconventional oil and gas resources.</p> <p><strong>Panelist Backgrounds (Via Fora.TV)</strong></p> <p>1. Peter Balash - Peter C. Balash, Ph.D., is senior economist at the United States Department of Energy&#8217;s National Energy Technology Laboratory (NETL), in Pittsburgh, Pennsylvania. He has followed energy markets, energy security, and technology issues for NETL since 2002, focusing on the interaction of upstream fuel market developments with downstream, or end-use, sectors.</p> <p>2. Frits Eulderink - Frits Eulderink began his career with Shell in 1990. He spent a portion of his initial assignment working in the United States on Coal Gasification at the Westhollow Research Center and the Deer Park facility in Houston, Texas.</p> <p>3. Gordon Pickering - Gordon Pickering, Navigant Consulting, Inc., is a Director in NCI&#8217;s Fuels Analysis practice, in Sacramento, CA. He has over 28 years of energy industry experience, mostly in the natural gas industry in the United States and Canada. Throughout his career, Mr. Pickering has worked closely with the electric generation sector as a natural gas marketer and commodity services supplier and most recently as a consultant.</p> <p>4. Andre Plourde - Andre Plourde is Professor and Chair, Department of Economics, University of Alberta. He received his B.A. and M.A. in Economics from the University of New Brunswick, and a Ph.D. in Economics from the University of British Columbia</p> <p>5. John Wimer - Mr. Wimer has worked at the U.S. Department of Energy&#8217;s National Energy Technology Laboratory for eighteen years, providing engineering support to DOE&#8217;s Fossil Energy research and development programs, primarily in the areas of advanced coal conversion technologies. Presently, Mr. Wimer is the director of NETL&#8217;s Systems Division, which performs technology evaluation, systems engineering and economic analyses to inform policy makers and to guide NETL&#8217;s R&amp;D programs.</p> <p><a href="http://fora.tv/2009/06/23/IAEE_Conference_Unconventional_Oil_and_Gas_Resources"><strong>Watch The Video Below Or Click Here For Our Email/Rss Subscribers</strong></a></p> <p><object width="400" height="264" data="http://fora.tv/embedded_player" type="application/x-shockwave-flash"><param name="flashvars" value="webhost=fora.tv&amp;clipid=9706&amp;cliptype=full" /><param name="allowScriptAccess" value="always" /><param name="allowFullScreen" value="true" /><param name="src" value="http://fora.tv/embedded_player" /><param name="allowfullscreen" value="true" /></object></p>

Posted by Miguel on July 02, 2009 05:00 AM · permalink

  <p>Have you ever wondered how much weekly time is spent on different online applications ?</p> <p><strong>Click On The Image For A Larger Version</strong><br /> <a href="http://www.techcrunch.com/wp-content/uploads/2009/04/picture-315.png"><img class="alignnone" src="http://www.techcrunch.com/wp-content/uploads/2009/04/picture-315.png" alt="" width="526" height="392" /></a></p>

Posted by Miguel on July 02, 2009 04:00 AM · permalink

  <p>My friends over at The manual of ideas ( I recommend subscribing to their online investor services) have recently put together a list of interesting inflation arguments. Enjoy!</p> <p><a style="margin: 12px auto 6px auto; font-family: Helvetica,Arial,Sans-serif; font-style: normal; font-variant: normal; font-weight: normal; font-size: 14px; line-height: normal; font-size-adjust: none; font-stretch: normal; -x-system-font: none; display: block; text-decoration: underline;" title="View Notable Statements on Inflation, 2009 on Scribd" href="http://www.scribd.com/doc/16885539/Notable-Statements-on-Inflation-2009">Notable Statements on Inflation, 2009</a> <object width="420" height="502" data="http://d.scribd.com/ScribdViewer.swf?document_id=16885539&amp;access_key=key-2a6ym0np608haie8r9p2&amp;page=1&amp;version=1&amp;viewMode=" type="application/x-shockwave-flash"><param name="id" value="doc_501628624568274" /><param name="name" value="doc_501628624568274" /><param name="align" value="middle" /><param name="quality" value="high" /><param name="play" value="true" /><param name="loop" value="true" /><param name="scale" value="showall" /><param name="wmode" value="opaque" /><param name="devicefont" value="false" /><param name="bgcolor" value="#ffffff" /><param name="menu" value="true" /><param name="allowFullScreen" value="true" /><param name="allowScriptAccess" value="always" /><param name="src" value="http://d.scribd.com/ScribdViewer.swf?document_id=16885539&amp;access_key=key-2a6ym0np608haie8r9p2&amp;page=1&amp;version=1&amp;viewMode=" /><param name="allowfullscreen" value="true" /></object></p>

Posted by Miguel on July 02, 2009 03:00 AM · permalink

  <p>Interesting paper on the financial crisis, developing countries, and financial challenges.</p> <p style="text-align: center;"><a href="http://www.piie.com/publications/papers/print.cfm?doc=pub&amp;ResearchID=1240"><strong>Click Here T0 Read About The Global Financial Crisis: Lessons Learned and Challenges for Developing Countries</strong></a></p> <p><strong>Introduction (Via PIIE.com)</strong></p> <p>Almost two years ago, the global economy and financial system entered a severe crisis. The incidence and ramifications of the crisis were obscure. Even now, the full dimensions and consequences are not known, but almost certainly this crisis will prove to be the most severe in the extent and severity of its global impact and depth since the end of World War II. Because the crisis is not yet over, among other reasons, we lack the perspective to develop a full catalog of the lessons from the crisis, either in general or for developing countries in particular. However, I thank the Banco de Guatemala for inviting me to share my thoughts on this important and complex subject from the vantage point of June 2009.</p> <p>In these remarks, I first offer my perspective on the causes of this crisis and how this crisis differs from previous global financial crises. This is a necessary precondition to learning the appropriate lessons from the crisis. Otherwise our lessons will be off-target or incomplete. Second, I offer some key relevant lessons under five headings: too good to be true is probably false; be better prepared; the myth of self-insurance; the role of the International Monetary Fund (IMF); and the future of globalization.</p> <p><strong>Excerpts (Via PIIE.com)</strong></p> <p>Benign conditions lead to lax lending standards, just as the night follows the day. In principle, financial-sector supervision could have helped to curb the excesses, but it did not do so in the United States or in many other countries around the world.</p> <p>Part of the overall picture was new forms of financial engineering, but innovations have been a feature of domestic and international finance for decades. In many cases, the associated innovations were poorly understood, resulting in a failure of risk recognition, which is a necessary precondition for good risk management. Financial engineering contributed to the market dynamics once the crisis got underway, but it was not &#8220;the cause&#8221; of the crisis.</p> <p style="text-align: center;"><a href="http://www.piie.com/publications/papers/print.cfm?doc=pub&amp;ResearchID=1240"><strong>Click Here T0 Read About The Global Financial Crisis: Lessons Learned and Challenges for Developing Countries</strong></a></p>

Posted by Miguel on July 02, 2009 02:00 AM · permalink

  <p>I recommend reading &amp; listening to Shirky&#8217;s advice. This talk is about <a href="http://isbn.nu/978-1594201530"><strong><em>The Power of Organizing Without Organizations</em></strong></a>.</p> <p><strong>Background On Clay Shirky (Via Wikipedia)</strong></p> <p>Mr. Shirky is an American writer, consultant and teacher on the social and economic effects of Internet technologies. He teaches <span class="mw-redirect">New Media</span> as an adjunct professor at New York University&#8217;s (NYU) graduate <span class="mw-redirect">Interactive Telecommunications Program</span> (ITP). His courses address, among other things, the interrelated effects of the topology of social networks and technological networks, how our networks shape culture and vice-versa. He has written and been interviewed extensively about the Internet since 1996. His columns and writings have appeared in <em>Business 2.0</em>, the <em><span class="mw-redirect">New York Times</span></em>, the <em><span class="mw-redirect">Wall Street Journal</span></em>, the <em>Harvard Business Review</em> and <em><span class="mw-redirect">Wired</span></em>.</p> <p><a href="http://www.google.com/url?sa=t&amp;source=web&amp;ct=res&amp;cd=1&amp;url=http%3A%2F%2Fwww.shirky.com%2F&amp;ei=e8hLSrnNHInwMdmr8LcC&amp;rct=j&amp;q=clay+shirky&amp;usg=AFQjCNH6tHeh9Y5S9hMZRpc3G7JcdD6FEw&amp;sig2=yU220_qlPJKWNIM4RLQv6A">Shirky&#8217;s Homepage</a></p> <p><strong><a href="http://www.ideasproject.com/content.webui?id=4000">Watch The Video Below Or Click Here For Our Rss Subscribers (Video Accessed Via IP)</a></strong><br /> <object width="425" height="344" data="http://www.youtube.com/v/A_0FgRKsqqU&amp;rel=0&amp;color1=0xb1b1b1&amp;color2=0xcfcfcf&amp;hl=en&amp;feature=player_embedded&amp;fs=1" type="application/x-shockwave-flash"><param name="allowFullScreen" value="true" /><param name="allowScriptAccess" value="always" /><param name="src" value="http://www.youtube.com/v/A_0FgRKsqqU&amp;rel=0&amp;color1=0xb1b1b1&amp;color2=0xcfcfcf&amp;hl=en&amp;feature=player_embedded&amp;fs=1" /><param name="allowfullscreen" value="true" /></object></p>

Posted by Miguel on July 02, 2009 01:00 AM · permalink

  <p>Why am I such a sucker for these papers!</p> <p style="text-align: center;"><a href="http://journal.sjdm.org/06143/jdm06143.htm"><strong>Click Here To Learn About Individual Susceptibility To Anchoring Effects</strong></a></p> <p><strong>Abstract (Via Todd McElroy and Keith Dowd</strong><strong> @ JDM)</strong></p> <p>Previous research on anchoring has shown this heuristic to be a very robust psychological phenomenon ubiquitous across many domains of human judgment and decision-making. Despite the prevalence of anchoring effects, researchers have only recently begun to investigate the underlying factors responsible for how and in what ways a person is susceptible to them. This paper examines how one such factor, the Big-Five personality trait of openness-to-experience, influences the effect of previously presented anchors on participants&#8217; judgments. Our findings indicate that participants high in openness-to-experience were significantly more influenced by anchoring cues relative to participants low in this trait. These findings were consistent across two different types of anchoring tasks providing convergent evidence for our hypothesis.</p> <p><strong>Introduction </strong><strong>(Via Todd McElroy and Keith Dowd</strong><strong> @</strong><strong> JDM)</strong></p> <p>The anchoring effect (e.g., Lichtenstein &amp; Slovic, 1971; Tversky &amp; Kahneman, 1974; Wilson, Houston, Etling, &amp; Brekke, 1996) refers to the adjustment of one&#8217;s assessment, higher or lower, based upon previously presented external information or an &#8220;anchor.&#8221; The anchoring heuristic appears to be prevalent throughout human decision processes and has been shown to reliably influence judgments in a variety of domains including probability estimates (Plous, 1989; Tversky n&amp; Kahneman, 1974), negotiation (Neale &amp; Bazerman, 1991; Ritov, 1996), legal judgments (Chapman &amp; Bornstein, 1996), and general knowledge (Chapman &amp; Johnson, 1999; Jacowitz &amp; Kahnman, 1995; Wilson, Houston, Etling, &amp; Brekke, 1996). Further, anchoring effects appear viable across most situations for both novices and experts (Northcraft &amp; Neale, 1987) and seem to be effective under conditions of monetary incentives (Chapman &amp; Johnson, 1999; Wilson, Houston, Etling, &amp; Brekke, 1996; Wright &amp; Anderson, 1989) and in real-world settings (Northcraft &amp; Neale, 1987; Cervone &amp; Peak, 1986).</p> <p><strong>Excerpt (Via</strong><strong> Todd McElroy and Keith Dowd</strong><strong> @</strong><strong> JDM)</strong></p> <p>Anchoring thus appears to be a very robust psychological phenomenon. However, not all individuals may be equally influenced by anchoring cues. Identification of factors that influence how and in what ways a person is susceptible to this heuristic should further the understanding of the process. One avenue of approach is to investigate the role of individual difference factors.</p> <p style="text-align: center;"><a href="http://journal.sjdm.org/06143/jdm06143.htm"><strong>Click Here To Learn About Individual Susceptibility To Anchoring Effects</strong></a></p>

Posted by Miguel on July 02, 2009 12:00 AM · permalink

  <p>In depth look at the The Six-Step Rational Decision-Making Model. Enjoy!</p> <p><strong>Overview of the model</strong></p> <p>Step 1. Define The Problem</p> <p>Step 2. Identify The Decision Criteria</p> <p>Step 3. Weight The Criteria</p> <p>Step 4. Generate Alternatives</p> <p>Step 5. Rate Each Alternative On Each Criteria</p> <p>Step 6. Compute Optimal Decision</p> <p><a style="margin: 12px auto 6px auto; font-family: Helvetica,Arial,Sans-serif; font-style: normal; font-variant: normal; font-weight: normal; font-size: 14px; line-height: normal; font-size-adjust: none; font-stretch: normal; -x-system-font: none; display: block; text-decoration: underline;" title="View The Six-Step Rational Decision-Making Model on Scribd" href="http://www.scribd.com/doc/906096/The-SixStep-Rational-DecisionMaking-Model">The Six-Step Rational Decision-Making Model</a> <object width="413" height="502" data="http://d.scribd.com/ScribdViewer.swf?document_id=906096&amp;access_key=key-17b89tdcwyol7ax68p6a&amp;page=1&amp;version=1&amp;viewMode=" type="application/x-shockwave-flash"><param name="id" value="doc_700581796587209" /><param name="name" value="doc_700581796587209" /><param name="align" value="middle" /><param name="quality" value="high" /><param name="play" value="true" /><param name="loop" value="true" /><param name="scale" value="showall" /><param name="wmode" value="opaque" /><param name="devicefont" value="false" /><param name="bgcolor" value="#ffffff" /><param name="menu" value="true" /><param name="allowFullScreen" value="true" /><param name="allowScriptAccess" value="always" /><param name="src" value="http://d.scribd.com/ScribdViewer.swf?document_id=906096&amp;access_key=key-17b89tdcwyol7ax68p6a&amp;page=1&amp;version=1&amp;viewMode=" /><param name="allowfullscreen" value="true" /></object></p>

Posted by Miguel on July 01, 2009 11:05 PM · permalink

  <p>This interview was conducted in 1996. If you&#8217;re a fan of James Grant please take the time to read this.</p> <p>*Found this article via Value Investing World (Great Find Joe)</p> <p style="text-align: center;"><a href="http://mises.org/journals/aen/aen16_4_1.asp"><strong>Click Here To Read About Mises Interviewing James Grant</strong></a></p> <p><strong>Introduction (Via Mises.Org)</strong></p> <p><strong>AEN</strong>: Your argument about business cycles in <em>The Trouble with Prosperity</em> rests heavily on the work of the Austrian economist Wilhelm Röpke instead of the more well-known Austrians.</p> <p><strong>GRANT</strong>: I am an observer of the contemporary scene, a journalist, rather than a theorist. I picked up Austrian economics almost everywhere except in school. It came to me, and I to it, in the way that the Austrians say that so many good things happen, that is, by accident, rather than by design.</p> <p>Over the years I read Mises, Hayek, Rothbard, and others on interest rates, capital, and the business cycle. I&#8217;ve long been inspired by Henry Hazlitt&#8217;s career, someone who wrote as well as he did, and as long. To think that this man professed the ideas he did in the pages of the mainstream press is certainly startling and revelatory.</p> <p>I chose to feature Röpke because of his book <em>Crises and Cycles</em>, which appeared in English during the Great Depression. He offers a clear and forceful exposition of the mechanics of the Austrian interest-rate and business-cycle model, and the very difficult but rewarding structure of the theory itself. Vera Smith must have done a great job in translating the work. By the way, I recommend Vera Smiths book <em>The Rationale of Central Banking</em> as a further elucidation on Röpke&#8217;s already clear theory. I know there are all sorts of holes in my bibliography; there might be better and more faithful explanations than Röpke offers. But I really do recommend this to people for its simplicity.</p> <p style="text-align: center;"><a href="http://mises.org/journals/aen/aen16_4_1.asp"><strong>Click Here To Read About Mises Interviewing James Grant</strong></a></p>

Posted by Miguel on July 01, 2009 03:05 AM · permalink

  <p>This interview was conducted in 1996 and it is worth taking the time to read.</p> <p style="text-align: center;">(Found this  interview via Value Investing World awesome find Joe&#8230;)</p> <p style="text-align: center;"><strong><a href="http://mises.org/journals/aen/aen16_4_1.asp">Click Here To Read The Mises Institute Interviewing James Grant</a></strong></p> <p><strong>Introduction (Via Mises.org)</strong></p> <p><strong>AEN</strong>: Your argument about business cycles in <em>The Trouble with Prosperity</em> rests heavily on the work of the Austrian economist Wilhelm Röpke instead of the more well-known Austrians.</p> <p><strong>GRANT</strong>: I am an observer of the contemporary scene, a journalist, rather than a theorist. I picked up Austrian economics almost everywhere except in school. It came to me, and I to it, in the way that the Austrians say that so many good things happen, that is, by accident, rather than by design.</p> <p>Over the years I read Mises, Hayek, Rothbard, and others on interest rates, capital, and the business cycle. I&#8217;ve long been inspired by Henry Hazlitt&#8217;s career, someone who wrote as well as he did, and as long. To think that this man professed the ideas he did in the pages of the mainstream press is certainly startling and revelatory.</p> <p>I chose to feature Röpke because of his book <em>Crises and Cycles</em>, which appeared in English during the Great Depression. He offers a clear and forceful exposition of the mechanics of the Austrian interest-rate and business-cycle model, and the very difficult but rewarding structure of the theory itself. Vera Smith must have done a great job in translating the work. By the way, I recommend Vera Smiths book <em>The Rationale of Central Banking</em> as a further elucidation on Röpke&#8217;s already clear theory. I know there are all sorts of holes in my bibliography; there might be better and more faithful explanations than Röpke offers. But I really do recommend this to people for its simplicity.</p> <p style="text-align: center;"><strong><a href="http://mises.org/journals/aen/aen16_4_1.asp">Click Here To Read The Mises Institute Interviewing James Grant</a></strong></p>

Posted by Miguel on July 01, 2009 03:02 AM · permalink

  <p>Very interesting piece on IQ scores, intelligence, public education and much more&#8230;..</p> <p>Note Joe Koster &amp; Farnam Street you will enjoy this article. <img src='http://www.simoleonsense.com/wp-includes/images/smilies/icon_smile.gif' alt=':)' class='wp-smiley' /> </p> <p style="text-align: center;"><a href="http://www.americanscientist.org/bookshelf/pub/the-domestication-of-the-savage-mind"><strong>Click Here To Learn About Intelligence &amp; The Flynn Effect</strong></a></p> <p><strong>I</strong><strong>ntroduction (Via American Scientist)</strong></p> <p>James Flynn is best known for having discovered a stubborn fact. In a series of papers culminating in the classic 1987 article “Massive IQ Gains in 14 Nations: What IQ Tests Really Measure,” he established that in every country where consistent IQ tests have been given to large numbers of people over time, scores have been rising as far back as the records go, in some cases to the early 20th century. <em>What Is Intelligence?</em> is Flynn’s attempt to explain this phenomenon, now known as the Flynn effect.</p> <p><strong>Excerpts (Via American Scientist)</strong></p> <p>&#8220;Thus two test takers who give exactly the same answers can get different IQ scores if normed against different reference samples. Test makers periodically renorm their tests, keeping the mean at 100, but the same score can represent very different levels of absolute performance.&#8221;</p> <p>&#8220;On average, measured IQ has been rising at roughly 3 points per decade across the industrialized world for as far back as the data go. This means that someone who got a score of 100 on an IQ test in 1900 would get a score of only 70 for the same answers in 2000. This is the Flynn effect.&#8221;</p> <p>Scores have risen because our way of thinking has shifted, Flynn says—we have been “liberated from the concrete” and have put on “scientific spectacles.” He claims the Flynn effect is a consequence of changes in the way people live and the skills they cultivate—changes brought about by the Industrial Revolution.</p> <p>Given Flynn’s idea that intelligence is how well and quickly we learn, IQ tests are an odd way to measure it. They do not set learning tasks and measure performance within a fixed time. At best they gauge past learning, which can indirectly measure the capacity to learn quickly and well but would be confounded with things like executive function and current and past motivation.</p> <p style="text-align: center;"><a href="http://www.americanscientist.org/bookshelf/pub/the-domestication-of-the-savage-mind"><strong>Click Here To Learn About Intelligence &amp; The Flynn Effect</strong></a></p>

Posted by Miguel on June 30, 2009 10:00 PM · permalink

  <p>Randy Pausch proves to be a wonderful speaker and thoughtful commentator. Here he talks about time management and why many of us  forget to practice it in our daily lives.</p> <p><strong>Introduction (via You Tube)</strong></p> <p><span class="description">Carnegie Mellon Professor Randy Pausch gave a lecture on Time Management at the University of Virginia in November 2007. </span><br /> <a href="http://www.youtube.com/watch?v=oTugjssqOT0&amp;feature=PlayList&amp;p=BCD362F95A724D1E&amp;index=16"><strong>Watch The Video Below Or Click Here For Our Email/Rss Subscribers </strong></a></p> <p><object width="425" height="344" data="http://www.youtube.com/v/oTugjssqOT0&amp;hl=en&amp;fs=1&amp;" type="application/x-shockwave-flash"><param name="allowFullScreen" value="true" /><param name="allowscriptaccess" value="always" /><param name="src" value="http://www.youtube.com/v/oTugjssqOT0&amp;hl=en&amp;fs=1&amp;" /><param name="allowfullscreen" value="true" /></object></p>

Posted by Miguel on June 30, 2009 09:00 PM · permalink