Weekly Roundup 06: A Curated Linkfest For The Smartest People On The Web
1. Recession Why Worry – Via NY Times – Reputable economic attitudes hold that the economic norm is high, if not quite full, employment and a reliable rate of expansion in economic output. Recessions are an aberrant departure from that norm. Correction must come. The question after nearly three years is whether this is so. Or is it possible that the economy has settled into an underemployment equilibrium of small or negligible growth?
2. Mises Institute Free Book: Concise Guide To Economics – Via Mises.Org & Scribd- To understand economics is to understand the practical case for freedom. The great merit of this book is to bring out the connection in the clearest and shortest possible way.
3. Liars Poker: A popular book predicts our demise – Via Economic Policy Review – When asked, the average, eager, Wall Street bound undergraduate would tell recruiters their favorite book is Liar’s Poker and their favorite movie is Wall Street. Michael Lewis’s semi-autobiographical book, Liar’s Poker, is a first hand account of the rise of Salomon Bond traders, junk bonds, and mortgaged backed securities in the 1980’s. The 1980’s was an era of deregulation; the deregulation that in part lead to S&L Crisis of the late 1980’s and early 1990’s. Lewis’ 1985 Salomon Brothers analyst class is in large part running Wall Street in 2008 and those eager undergrads that so idolized the trader lifestyle, big money and even bigger egos, are left holding the bag – a largely empty bag containing pink slips and severance checks.
4. Donald Kohn’s Essential Speech – Via The Economist & Federal Reserve – THOUGH there is a lot of blame to go around for this financial crisis, today’s policy makers are not of a mind to accept much of it. In these vindictive times, it is hardly in their interest to admit to fault even if they believed they deserved it.
That is what makes Wednesday’s speech by Donald Kohn, vice chairman of the Federal Reserve, essential reading. Rare among policymakers, Mr Kohn has a remarkable ability to recall his own state of mind when he made important decisions in the past. Here, he gives what seems to me (as someone who followed everything he said at the time) a faithful account of what he believed, why he believed it, how those beliefs turned out wrong, and what can be learned as a result. This sort of reflection in real time is invaluable to anyone interested in learning from this crisis.
5. Radio Show: The Psychology of choice – Via Mind Hacks – The excellent RadioLab has returned with a new series and the first is a programme on the psychology of how we make choices, and what can go wrong when brain damage prevents us from making decisions.
The RadioLab team talk to psychologist Barry Schwartz, author of the ‘Paradox of Choice’ on why more choice means people tend to be less happy with their decision, to neuropsychologist Antoine Bechara on how a famous case of frontal lobe damage helped us understand why emotion plays a role in even the most mundane of choices, and to the ubiquitous Malcom Gladwell on the role of the unconscious.
6. Complex Systems: How do Math and Intuition Help Us Understand Systems– Via Science Daily – Peter Dodds is lost. Well, not exactly. He knows he’s going to meet me at 2:30 in the Davis Center. But just where? He doesn’t remember. And yet, without hesitation, he walks into the atrium, past crowds of people, up the sweeping staircase and directly into Henderson’s coffee shop.
7. Turing Hedge Funds Into Private Equity – Via Information Arbitrage – Many hedge funds are in trouble. Whether due to bad security selection, issues that were once considered liquid that now “trade by appointment” or by jittery LPs, managers are having to generate cash to meet a flood of redemption requests. This has placed tremendous pressure on managers who are not only depressed to see management fees drop while high-water marks remain far out-of-reach, but who have hard decisions to make about which assets should be converted into cash.
8. Video: Guy Kawasaki: The Power Of No BS– Via Fora.Tv- For nearly 30 years, Kawasaki has earned a notable reputation as a venture capitalist, entrepreneur and popular blogger. The former Apple evangelist will share his provocative insights and commonsense practices for succeeding in today’s business world.
9. MIT Video Lecture On Energy – Via MIT.edu- There are few people who have spent as much time wielding high-level influence in Washington as George Shultz, and in such a variety of roles (Secretary of Labor, Treasury and State, plus the Office of Management and Budget, among others). So the MIT Energy Initiative has much to gain from a friend with this kind of distinguished government record.
Shultz sees the U.S. at a momentous crossroads that he views, this time, with optimism. “Powerful constituencies are involved in this, all oddly pointing in the same direction.” National and economic security and climate change are converging to force our hand. Shultz envisions the next administration taking on a host of actions: a “stable tax regime” for wind and solar power; carbon capture and transformation (rather than the iffy sequestration); implementation of nuclear power, if we can “come to grips with the nuclear fuel cycle issue;” ending the “dumb policy” of corn-based ethanol subsidies; and finding a better car battery.