I had Drudge recommended to me by a friend in class - here is one of the first links I found. It's Buzz Aldrin, he of moderate Apollo 11 fame, talking about how he sank into a deep depression after getting back from the moon because his life had no purpose. He wants America to go back to space, but this time to Mars. His reasoning is something I've never thought of before:
"Exploring and colonizing Mars can bring us new scientific understanding of climate change, of how planet-wide processes can make a warm and wet world into a barren landscape. By exploring and understanding Mars, we may gain key insights into the past and future of our own world."
Is this nothing more than a plea to return to the final frontier, or is there merit behind the idea of colonizing Mars to learn about climate change? I'm reasonably certain it's the former. Right?
Wednesday, June 24, 2009
The Italian Economy: Last Day!
(Because I didn't want to call it day thirteen, for obvious reasons...)
I still have my final tomorrow but essentially this is it. A lot of interesting stuff, most of it much more interesting than what I've blogged about. I'm going to try to write up a decent synthesis of all this info while I'm in California... we'll see what happens.
Today's most interesting snippet: according to my professor, no euro zone state has deposit insurance akin to the FDIC. This is because the banking sector is so highly regulated that deposit insurance is unnecessary. (I've been unable to verify this fact yet)
I can't imagine this is an optimal situation for anyone. Too much money spent on regulators, who may well make a mistake at some point anyway, and too little room for banks and citizens to profit. One of the biggest things holding back investment and innovation in Italy is the difficulty of securing a loan; easier credit would result in more defaults, but also more growth.
Next: 90% of Italian companies are family-owned. From Molteni to Circi, Versace and everything in between, nearly every business is passed from father to son, and even bears the family name.
Oh, and there are only 294 companies listed on the Italian stock exchange. Wow.
It's been a great ride. Final tomorrow, synthesis in the future, and retirement to a villa on the countryside in 40 years.
I still have my final tomorrow but essentially this is it. A lot of interesting stuff, most of it much more interesting than what I've blogged about. I'm going to try to write up a decent synthesis of all this info while I'm in California... we'll see what happens.
Today's most interesting snippet: according to my professor, no euro zone state has deposit insurance akin to the FDIC. This is because the banking sector is so highly regulated that deposit insurance is unnecessary. (I've been unable to verify this fact yet)
I can't imagine this is an optimal situation for anyone. Too much money spent on regulators, who may well make a mistake at some point anyway, and too little room for banks and citizens to profit. One of the biggest things holding back investment and innovation in Italy is the difficulty of securing a loan; easier credit would result in more defaults, but also more growth.
Next: 90% of Italian companies are family-owned. From Molteni to Circi, Versace and everything in between, nearly every business is passed from father to son, and even bears the family name.
Oh, and there are only 294 companies listed on the Italian stock exchange. Wow.
It's been a great ride. Final tomorrow, synthesis in the future, and retirement to a villa on the countryside in 40 years.
More Powerful Fed?
According to this article in today's New York Times, Ben Bernanke is seeking an expansion of the power of the Fed and President Obama supports this.
I'm pretty sure Tyler already addressed this in the Times - here is the article from May. Here is MR. I don't want to simply re-post old things from a better blog than this one, but I think Tyler's point is worth repeating and will need to be repeated over and over for the next couple of years. The Constitution explicitly makes the legislative the most powerful branch, and though it is often easier to defer decision-making powers to the executive branch, I think the Iraqi invasion underscores the need for it to be difficult to make substantial policy decisions.
Personally, I think it's time for the judicial branch to re-assert its authority. Since Jackson, the executive branch is constantly trying to expand. Ever since FDR nearly subsumed the Supreme Court, I think the balance of power has shifted too far away from the court system, and I think the recent expansion of executive power needs to be cut down by the courts. This is unlikely, at best, but I do believe it's what America needs.
I'm pretty sure Tyler already addressed this in the Times - here is the article from May. Here is MR. I don't want to simply re-post old things from a better blog than this one, but I think Tyler's point is worth repeating and will need to be repeated over and over for the next couple of years. The Constitution explicitly makes the legislative the most powerful branch, and though it is often easier to defer decision-making powers to the executive branch, I think the Iraqi invasion underscores the need for it to be difficult to make substantial policy decisions.
Personally, I think it's time for the judicial branch to re-assert its authority. Since Jackson, the executive branch is constantly trying to expand. Ever since FDR nearly subsumed the Supreme Court, I think the balance of power has shifted too far away from the court system, and I think the recent expansion of executive power needs to be cut down by the courts. This is unlikely, at best, but I do believe it's what America needs.
Tuesday, June 23, 2009
US, EU on Nationalization
According to this article in the Wall Street Journal Europe, the US is actually more open about governmental involvement in its economy than the European Union. They use Microsoft Windows as an example of EU regulations functioning in the same vein as the government-led bankruptcies of Chrysler and GM in America.
"Governments historically have proven singularly inept at making design decisions, as any number of jokes and real-life stories about Soviet-style economies make clear." Absolutely dripping with Masonomics, one of the things I have missed most while in Italy.
"Once an agency like the EU's competition directorate asserts authority over the features included in a dominant firm's products, there is no easy stopping point short of complete control of all significant business decisions. Once government opens this door, rival businesses (which don't want the leading firm's bundle competing with their products) learn that complaining to government can be a less costly way to gain market share than investing in better products, packaging or marketing."
Sounds like the EU needs to watch Cartoon Wars.
"Governments historically have proven singularly inept at making design decisions, as any number of jokes and real-life stories about Soviet-style economies make clear." Absolutely dripping with Masonomics, one of the things I have missed most while in Italy.
"Once an agency like the EU's competition directorate asserts authority over the features included in a dominant firm's products, there is no easy stopping point short of complete control of all significant business decisions. Once government opens this door, rival businesses (which don't want the leading firm's bundle competing with their products) learn that complaining to government can be a less costly way to gain market share than investing in better products, packaging or marketing."
Sounds like the EU needs to watch Cartoon Wars.
Monday, June 22, 2009
Diamonds in their Eyes...
“Toyota wrote the playbook and Hyundai read it: Build great cars with great value, and people will come.”
That's from this article on Bloomberg about the fall of Toyota. Well, okay, the fall hasn't happened yet, but it's possible on the horizon based on how closely Toyota Motor Corporation has followed General Motors for the past decade or more.
That's from this article on Bloomberg about the fall of Toyota. Well, okay, the fall hasn't happened yet, but it's possible on the horizon based on how closely Toyota Motor Corporation has followed General Motors for the past decade or more.
The Italian Economy: Day 12
Today, we continued to discuss the dichotomy between the North and the South within Italy. Italy provides a great rejection of Keynesian economics with the "Cathedrals in the Desert" built in Southern Italy in the 1960s. The government financed the production of different factories, including a Fiat plant, chemical plant, and an oil refinery along the coast in Sicily, expecting a trickle-down of wealth. It got the trickle-down to a small extent, but mostly just created environmental problems today. Oh, and the factories are largely closed or closing, because it's simply not profitable to do business in the South.
Factories, of course, make no sense as government investments, because they are capital intensive. If you are a government and really want to stimulate employment, you should invest in labor-intensive industries such as agriculture and tourism, which are the two industries that currently dominate the Southern Italian economy.
George Mason moment of the day: we were complaining about the inefficiency of bureaucracy and without knowing it, my professor described Parkinson's Law. "Work expands to fill the time provided." What an excellent little book - look it up, it takes about a half hour to read the whole thing. Funny throughout.
My last thought: The opportunity cost of doing business in Southern Italy is simply too high. With labor costs standard throughout the country (as discussed in earlier posts), bureaucracy costs as high there as anywhere else, terrible infrastructure, competition from the underground economy, and guaranteed interaction with the mafia if you turn a profit, there's simply no reason to go further from the heart of the EU and do business in the South of Italy. The problems are so vast, I can't even begin to suggest a solution.
Factories, of course, make no sense as government investments, because they are capital intensive. If you are a government and really want to stimulate employment, you should invest in labor-intensive industries such as agriculture and tourism, which are the two industries that currently dominate the Southern Italian economy.
George Mason moment of the day: we were complaining about the inefficiency of bureaucracy and without knowing it, my professor described Parkinson's Law. "Work expands to fill the time provided." What an excellent little book - look it up, it takes about a half hour to read the whole thing. Funny throughout.
My last thought: The opportunity cost of doing business in Southern Italy is simply too high. With labor costs standard throughout the country (as discussed in earlier posts), bureaucracy costs as high there as anywhere else, terrible infrastructure, competition from the underground economy, and guaranteed interaction with the mafia if you turn a profit, there's simply no reason to go further from the heart of the EU and do business in the South of Italy. The problems are so vast, I can't even begin to suggest a solution.
Weekends in Italy
Spent the last weekend on the Amalfi Coast - what an asbolutely stunning weekend. The view is something that can't be explained by words, and pictures don't really even capture the essence of it. Generally speaking, I'm not much for the touristy destinations, but my last two weekends at Cinque Terre and Amalfi were visits to tourist destinations that I absolutely loved.
I'm not sure where economics factors into any of this, I just felt like mentioning that these are two places you must visit at some point in your life.
I'm not sure where economics factors into any of this, I just felt like mentioning that these are two places you must visit at some point in your life.
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