My morning reads:

• A Smart Way To Look At A “Dumb” Investing Strategy (The Capital Spectator)
• Goldman: Short gold (FT Alphaville) see also Japanese Rush to Sell Gold as Price in Yen Jumps (WSJ)
• J.C. Penney Shows How the Market Overvalues the C.E.O. (DealBook)
This is how disgraced bankers ought to behave: Former Bank Chief Seeks to Give Up Knighthood, Pension (WSJ)
• Bernanke Says Interest on Reserves Would Be Main Tightening Tool (Bloomberg)
Matthew Yglesias: Scrap the Corporate Income Tax (Slate)
This is not a good sign: Introducing the 97-Month Car Loan (WSJ)
• Facebook Grabs for Your Phone. What Gives? (NYT)
• Authors Guild’s Scott Turow: Hey you kids, get off my lawn! A clueless old man discusses how  Copyright, Google, Ebooks, Libraries & Amazon Are All Destroying Authors (techdirt)
• The Internet’s Most Niche Website Is Also One of Its Most Brilliant (New Republic)

What are you reading?


Dow Hits Record Amid ‘Absence of Attractive Alternatives’ to Equities  

Source: WSJ

Category: Financial Press

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

24 Responses to “10 Mid-Week AM Reads”

  1. hue says:

    Holy Rabbit Ears: Two TV Networks Contemplate Going Off The Air in Fight Against Aereo & Other Digital Services (Forbes)

    Atheist Shoemaker Losed Faith in US Mail (npr)
    A Berlin shoe company sees evidence of bias after running an experiment that commentator Tania Lombrozo cites as “a great example of citizen science.” Packages with the company logo, Atheist, don’t arrive as fast as shoes wrapped in plain paper. However, can empirical results be adequately evaluated without a full, peer-review paper-sized report? Are most readers in a position to do so?.

    Scientific Articles Accepted (Personal Checks, Too): The Explosion of Pseudo Academia (:NYT)

  2. VennData says:

    Obama budget targets millionaires, replaces sequester cuts

    ​”…forcing millionaires to pay more in taxes and enacting spending cuts that replace the “sequester” reductions that went into place last month. President Barack Obama’s fiscal 2014 budget blueprint ensures that those making $1 million a year or more would have to pay at least 30 percent of their income in taxes, after gifts to charity, officials said…”​

    ​When did Millionaire become MAKING a million a year gross​? and not HAVING a million dollars of wealth?

  3. dsawy says:

    Fed “accidentally” leaked minutes a day early to 100 or so people:

  4. romerjt says:

    Reading Big Data – interesting take on causality vs correlation favoring correlation

  5. RW says:

    The model linked below looks at the problem of unemployment from a different perspective and shows how ‘structural’ unemployment is policy dependent. Unfortunately, given how politics work in the USA (and the political power that money currently wields), the problem may turn out to be nearly as resistant to change as if it was somehow ‘fundamental.’ Still it helps to get the ball in, or at least closer to, the right court. FWIW.

    What Non-inclusive Growth Looks LIke

    In a previous post, I presented the basic model of Effective demand. Now I want to apply that model to the growth of an economy. But I am going to show the dynamics of a specific kind of growth… Non-inclusive growth. In this type of growth, labor’s share of income does not rise as real GDP rises.

    NB: I have found most arguments that unemployment is structural rather than cyclical (demand slack) rather unpersuasive: First because the evidence presented is weak unless dates/periods are picked carefully or industrial/labor categories are (re)defined in a favorable manner and second because, with exceptions like the model above, they typically accept that ‘structural’ means ‘fundamental,’ not a consequence of policies and therefore not amenable to policy change; i.e., intractable and therefore an excuse to do nothing.

  6. S Brennan says:

    President Barack Obama keeps on signaling his willingness to cut Social Security benefits…

    “Paul Ryan, in the worst budget ever presented in the history of the United States, did not mention Social Security, so of course [Obama] owns it and I suspect that our Republican friends will make sure the American people understand that he owns it, and make sure the American people understand that any Democrat who supports cuts in Social Security and benefits for disabled vets will also be forced to own that,” Sanders said.

    Sanders went on to say, “From a political point of view it is to my mind just a really dumb tactic. I don’t understand it.”

    Bernie…because you are an old time pol, I understand you being confused…let me help. These cuts “sav[e] the federal government more than $100 billion in Social Security payments over 10 years. Now, you might point out that Obama has spent the last four years subsidizing his buddies in finance to the tune of 12-13 trillion, so being parsimonious is not Obama’s issue.

    So why, after blowing through cash like there’s no tomorrow, would you save .00007% of what you’ve blown on the backs of those least able to afford it? What’s going on Bernie, is this, Obama, like Clinton…is setting up his retirement fund. And the way to live fat and happy as ex-prez, is to do the bidding of .01% while in office.

    It’s the new way Bernie, the government is essentially a Potemkin village to make people think they still have a democracy…and you Bernie, are part of the window dressing…decisions are being made elsewhere. If it seems unnecessarily cruel, just look at all the isolated aristocracies of the past…because sadly, you are soaking in one now.

  7. spooz says:

    Slate assumes that all we need is to shift around the tax burden without the need to create new taxes to offset the deficit, built up, to a certain extent, from years of low taxes not paying for expensive wars.
    I like the ideas for new taxes, regular tax rates on financial gains and expanding the payroll tax limits, but would argue that we need to tax multinationals higher to make up for their competitive advantage above the small businesses that can provide jobs. And regarding repatriating tax sheltered earnings, never again. Any BS about job creation is propaganda for propping up the stock price with dividends and repurchases, same as last time. We need to stop multinational corporations’ use of offshore tax havens to avoid taxes.

    From the Daily Kos:
    “Globalization makes finding a means of reasonable taxation that is not squelched by tax-rate shopping difficult indeed. As the plutocrats become, individually and corporately, ever more mobile, they can be expected to crank up their search for a better deal while maintaining the high pitch of their whining about being overtaxed. They do this with a straight face even as their profits hit new records. It’s all part of the class war that has returned us to 1920s levels of income and wealth inequality, the lowest tax burden on the upper tiers since pre-New Deal era. The continuing cries from those with the most for more, more, more seems now permanently connected to demands that government provide less, less, less services to those who need them most.”

    • rswojo says:

      When Bush/Cheney were ginning up the Iraq invasion one of the rationales was it would pay for itself.

      The U.S. and the rest of the other higher tax countries should cooperatively invade a few of the tax havens, seize the accounts sheltered there, shut their operations down and prosecute the tax evaders with the evidence seized. The Cayman Islands would be a good place to start along with a few others just to set an example of what might happen to the rest.

      We could turn the U.S. military into a money making machine, get some value back from the money we spend on defense and teach the havens and the tax evaders they shelter a good lesson.

  8. VennData says:

    Senators Reach Bipartisan Deal on Checks of Gun Buyers

    GOP caves = progress

  9. Joe Friday says:

    Matthew Yglesias: Scrap the Corporate Income Tax


    Why is the answer to most corporations paying zero taxes and the rest paying less than 5%, to eliminate the corporate income tax ?

    The real answer is another version of the proposed Buffet Rule for millionaires and billionaires. Every corporation pays a minimum rate no matter what the write-offs.

    Problem solved.

  10. Bob is still unemployed   says:

    re: This is how disgraced bankers ought to behave

    In some respects, I think China may have a better way to deal with financial crimes than our Too Big To Jail paradigm.

  11. Mike in Nola says:

    Examples of the fraud that is law school. Schools with almost 1/3 of the graduates unemployed 9 months after graduation. The only reason these schools exist is to pull in money from student loans and leave the students stuck with the bill.

  12. DeDude says:

    So we fund a scientist to try and do some useful new discoveries. By the time (s)he is done with all the paperwork and training and administrative BS, 42% of the time allocated to that project has been used up.

    I have always said that if we continue to answer every little problem observed with another set of requirements of reportings, approvals and trainings; then eventually scientists will spend more time on that, than on doing their work. I guess the future is near. Good luck with that cure for cancer.

  13. willid3 says:

    so the austerians real agenda is to punish for wrongs. but they seem to think that means punish the wrong people is ok>?

    why not punish those that really caused the problem to begin with? with very heavy taxes too

  14. ilsm says:


    DoD has gotten around wasting R&D money on paper work.

    They no longer manage with specifications, and do not require the engineers to develop engineering drawing.

    As GAO 13-294sp (knowledge point observation 2 Pg 19) reports, by the time they do a “critical design reveiw” and allow the engineers to bend metal, the prorotype design is not stable nor solid and the test are not done because the requirements are not “allocated”.

    Saving the “useless” paper work results in useless engineering.

    • DeDude says:

      Actually the particular requirements you are talking about were not “useless” (obviously) nor was it really “administrative”. It should have been a part of the description of specified “work to be performed” in the original proposal. So what you are talking about is sloppy work not the administrative burden.

      • ilsm says:

        True, the baby went out with the bath water.

        In the “peace dividend” 1990′s to streamline the industry (reduce burden) the pentagon and congress adopted Fed Acquisition Streamlining (FASA) and Fed Acq Reform (FARA) which threw out MIL SPEC and STANDARDS.

        The result is debacles like F-35 with no specs, no link to requirements.

        Defense systems acquisition is broken! Even the auditors see it!

  15. willid3 says:

    not sure why we would think that eliminating the corporate income tax isn’t what corporations want any way, and why that would be a good thing. and corporations would just come up with a new way to escape taxes any way.

    • willid3 says:

      isnt this sort of related to the last scam where they convinced their government to give them a break on taxes on over seas profits, they they would create more jobs? how did that work out? oh they didnt create much in the way of new jobs, or much in the way of investments in the US at all.

  16. mathman says:

    Mr. Ritholtz: in the interest of your travel, particularly by air, there’s this to consider

    ‘Dark Lightning’ Zaps Airline Passengers with Radiation

    “Dark lightning” that is almost invisible within clouds may regularly blast airline passengers with large numbers of gamma rays, scientists find.

    However, these outbursts do not seem to reach truly dangerous levels, researchers added.

    More than a decade ago, researchers unexpectedly discovered thunderstorms could generate brief but powerful bursts of gamma rays, the highest-energy form of light. These so-called terrestrial gamma-ray flashes are so bright that they are able to blind sensors on satellites many hundreds of miles away.

    Worryingly, terrestrial gamma-ray flashes can occur near the same altitudes at which commercial aircraft regularly fly. Attempts to discover whether these flashes pose a radiation hazard to airline passengers have been hampered by a poor understanding of the cause of these flashes. Past research has also found these flashes hurl beams of antimatter into space. [The 5 Real Hazards of Air Travel]

    “We know in detail how black holes work at the centers of distant galaxies, but we don’t really understand what is going on inside thunderclouds just a few miles over our heads,” said researcher Joseph Dwyer, a physicist at the Florida Institute of Technology.

  17. wisegrowth says:

    My comment here is that we are not in a recession at the moment. I have been working on a model with someone who works in recession detection. My equations gave a model that seems very reliable. I don’t see a recession starting within the next 3 months either.

  18. VennData says:

    Muslim Brotherhood Confused About Michele Bachmann Attacks

    It was only a year or so ago she led the GOP Prez primary polls. …Until Rick Perry grabbed the bull by it’s droppings.

    The Queen of grocery-store-check-out-line Republican Marketing. Bachmann in 2016!

  19. Richard W. Kline says:

    Much of what is said in the techdirt polemic against Turow’s editorial is true; nearly all of it is irrelevant to the main point in that editorial. It strikes me again, having read the editorial and several replies to it, that those zinging lasers at Turow’s remarks are NONE of them authors, but rather those with stakes on the publishing side, or as in this case those blinded by their own righteous belief in ‘all tech is good tech.’

    Ebooks are cramming down authors’ revenues severely; that is a reality which techdirt just cannot bring itself to force through its mouth past the meal being spat out. techdirt has highlighted many making good big money from ebooks now? Hey, bueno, yes they are out there; but not most authors. We have more authors than ever, and very few of them will ever turn four figures of profit on what they make. Yes, many of those ‘new books’ deserve no more attention than that. What techdirt can’t get it’s head around is that by no means all present authors can transtion to a ‘hustle your own’ audience schmoozing model. Most non-fiction books of serious research and scholarship are getting killed in the new model. They have upfron costs, and an absolute, not terribly high ceiling on sales. Having royalties per book slashed to a small fraction of the present model simply means those books _don’t and WON’T get written_. There are huge problems with what copyright has become, and how it is explotied, like patents, by stakeholders who had nothing to do with a work’s creation. Reforming that situattion is extremely difficult in a publishing context changing on the fly, but what is certain is that _actual authors_ are the very LAST people interviewed by anyone on what needs to be done. Seems backward to me.

    Let’s be clear: I am all for ebooks (not that I like using them as a medium personally). I am a huge proponent of the concept of ‘authorial free agency.’ PUBLISHERS are the main problem in my view. There will not be enough revenue to sustain them in a transtioned to largely ebook environment—but then they offer many authors no value added _now_ while hogging most of the available revenue stream, and worse grabbing for even more of the much diminished ebook revenue stream from authors. So we need to fire publishers from the business. Yes, I’m a huge proponent of a new ‘agent-developer’ model for aiding authors, the ‘new guys who are more partners than publishers’ mentioned by techdirt. (I wrote a concept piece on this 15 years ago, and I’m only surprised it’s taken so long for the potential to get traction.) Turow could be seriously faulted in his article for not mentioning the real bane of the present writing environment—publishers; he is of course wholly tied to the publisher-controller model, and attempting to at least retain some leverage within that for authors during the transition to ebooks. Well there, Turow is in the wrong, publishers as constituted have to go—but none of these digital futurists really engage with that skew in his position.

    That said, the digital futurists have always been, and remain, blind to the revenue erosion for creators from piracy. Yes, growing the legitimate market is the larger point, and the future. Howeer, the fact that many authors in an already constricted revenue environment risk being bled to death if their product is useful to a small market that can get it free but are to small to be viable from make-it-up-in-volume transactions is _never_ engaged with by the futurians . . . who are almost NEVER actual ‘creators’ in my experience following this wrangle over 20 years. The digital futurians’ position seems to be “You should all get off your asses and hustle, you bums” is assinine in the context of creators who already have to invest years of effort to get good at, yah know, _creating that content_ and do not necessarily have the entirely unrelated skills at marketing, or the time required. Gladhanding your fans may sound to third parties like a better proposition than gladhanding a greedy publisher, but I can tell you that to most authors it sounds like, and is, a HUGE, neverending time-suck which will effectively leave no time for further writing. This is already a problem for DIY indy bands, for instance, never acknowledged by digital futurians as a constraint on a ‘new model’ for the _creators_ . . . because it’s NO constraint on the content consumers, natch. There have ALWAYS been a handful of DIY self-published authors out there who’ve made big money, exactly the folks moving ’500k books and getting a huge deal’ which techdirt mentions. That is a vanishingly tiny segment of the authorial public, then, now, and going forward. And those won’t include most historians, or belles lettre essayists, or limited genre novelists, and many others, who are unlikely ever to earn back enough from their texts to be worth the time involved. “Become a teacher and give away your work for free” I’ve heard more than one digital solipcist say to the face of an author worried over the pare down of sales revenues; as if one has the time for two full-time jobs, or would turn out a decent text under the circumstances. Pointing to the two dozen individuals who can pull that off doesn’t speak to the thousands of nonfiction authors who, as ebooks stand now, will never be compensated for their time with more than beer money.

    Authorial free agency, the death of the publisher-controller, and a 70/30 ebook/real book ratio or the like is the future, and I’m down with that. We need to hear more AUTHORS discuss how this does work and will work for them rather than digital proselytizers who frankly don’t give a damn if anyone actually writing can make anything off what they do but want the goods ‘all free all the time.’