Guy Berger

I think Laswell's mix of "Rated X" is very worthy and in some respects superior to the original. Guy

I haven't read the whole article, but I agree with the gist of it -- it would be extremely unfortunate if European squeamishness about "genetically modified" food resulted in greater hunger in the poor areas of the world. Guy

Props to the guy that came up with it, and also to the WFP, which does a lot of good, but I wish some of these resources would get diverted to cash aid -- in all but the most dire circumstances it's superior to food aid. Guy

I'm a lot more lukewarm about GUWI than Lon, but get it first. Then if you like it check out Laswell's reimagining of the material. Guy

Porcy... this would require an epic explanation, but to keep it short: subprime doesn't refer to mutual funds, but rather to a class of borrowers who are not prime (whether due to low incomes, poor credit history, etc). In the US, mortgage lending to these kinds of borrowers took off in the past few years; due to a combination of poor understanding of the actual terms of the loans, dishonesty by lenders and dishonesty by borrowers, much higher numbers of these borrowers are defaulting on their mortgages in the past. This is leading to turmoil in financial markets because bonds linked to these mortgages are turning out to be much riskier than previously believed. Guy Thanks, I knew it, more or less, but if traditional credit is based on judgment on solvibility of the borrowers, prime if I understood correctly, lending to subprime and sell the risk to others through bonds is a good deal, as far the lenders minimize their risk sharing it with unaware people who bought the bonds. Well, when lending to riskier borrowers the lender makes up for the greater riskiness of the loan by charging a higher rate of interest. You are 100% that securitization reduces this link by (A) pooling and diversifying the risk from individual loans and (B) by shifting risk to people who are more willing to bear it. My understanding is that, in fact, more Americans did gain access to credit as a result. I don't know how much of it this is due to chicanery (lenders and/or borrowers lying about the quality of the underlying loans). Guy

I think your argument is missing an element -- usually by the time somebody is forced to go to a payday lender they're already in pretty bad shape. Honestly, I don't know the economics of the industry well enough to judge. Are payday lenders much more profitable than mainstream lenders? Maybe, maybe not. If this is an incredibly profitable sector, why aren't mainstream lenders entering it? The reason that these guys advertise the ease of getting cash is because that's exactly the most important thing for their customers. By the way, I completely agree with Dan that it would be interesting and worthwhile to see a study of this industry in the US. Guy

BW, Something in your story doesn't quite wash. If checking accounts at banks really are a perfect alternative to check cashing services... why are people still using check cashing services? I'm guessing it's a combination of poor access to local banking services, perhaps distrusts and/or unawareness of local banking services... For what it's worth, AFAIK I cannot access the full cash amount of a deposited check after depositing it, but only a fraction. For somebody who needs cash NOW that could be a significant constraint. The poor (in the US and elsewhere) are "underbanked". Reducing access to payday lending isn't going to solve this problem.

Porcy... this would require an epic explanation, but to keep it short: subprime doesn't refer to mutual funds, but rather to a class of borrowers who are not prime (whether due to low incomes, poor credit history, etc). In the US, mortgage lending to these kinds of borrowers took off in the past few years; due to a combination of poor understanding of the actual terms of the loans, dishonesty by lenders and dishonesty by borrowers, much higher numbers of these borrowers are defaulting on their mortgages in the past. This is leading to turmoil in financial markets because bonds linked to these mortgages are turning out to be much riskier than previously believed. Guy

Karlan and Zinman had an editorial in Thursday's Wall Street Journal. I think their arguments are fundamentally sound, though this sort of tone may not go over well outside of the ivory tower... edit: actually, after the first paragraph I thought the tone was quite reasonable. (disclosure: I TA'd for Karlan when I was a grad student)

Hmmm.... I'll look into it. Thanks! San Clemente is indeed beautiful, though about 45 min away from San Diego. On the plus side you live next to these:

Kenny Dorham is gay?!?!? (Sorry, the two subject headers were next to each other)

Interesting article, with a good exposition of the Phillips Curve -- the relationship (sort of) that underpins much of modern monetary policy, and also the reason that almost all economists favor central bank independence.

By the way, I recommend Del Mar though it may be a little pricey or La Jolla if you are really loaded. Guy

This one is even better

The only thing I would say is pay attention to the business press... home prices in the US have not bottomed out. Of course if you don't care about buying at the bottom, go for it. I totally agree about San Diego, there is no nicer place in the US. (OK, maybe Maui.) Guy

Actually, he's not far off the mark, even if it is naive. I agree with Paul 100%. Guy

This will probably be funny only to people familiar with the episode in question, but I saw it last night and was rolling: crentist

While it's hard to deny that it's currently a "tinderbox," I'm not sure if that's an accurate assessment in general. Yes, California is in the midst of a severe drought (blame global warming?), and combined with worse-than-usual Santa Ana winds it makes the fire danger high, but it's not like these fires are occuring in remote regions were people shouldn't be living. Some of the areas are mountainous, but these are towns/cities that are in danger, not some antisocial hermit who's living on the edge of civilization. Many of the areas could be considered fairly high-density suburbs, bounded by interstate highways. Is it any better to live near lakes, rivers, and oceans because they may occassionally flood and/or be in the path of hurricanes and tornados? Well, San Diego has had two bouts of extremely destructive fires in five years. If people wish to live in areas that are particularly prone to natural or other disasters (and I would agree that the same criticism can be directed at those who live in New Orleans, earthquake country, tornadoes, floods, droughts, whatever), they should at least foot the bill for the inevitable rescue ahead of time. Whether it's through higher taxes or mandatory insurance... I don't know. Guy

I'm largely oblivious to these things in general, and haven't read the 7th book yet, so maybe it's obvious in that one. And frankly, I don't care much either way. But GA Russell's comments are... puzzling. I agree that in general explicit sex doesn't belong in kids' literature,* but romance (with occasional hints of more) has been in there since the beginning of time. And it's present in hefty doses inside the Harry Potter. That's not surprising because the series (particularly the later books) is aimed at young adults, who are experiencing this kind of stuff (along with more explicit stuff, as they age) daily in their real lives. Since I am guessing that GA Russell doesn't find this kind of largely chaste romance to be objectionable, it's pretty obvious to me why he is upset by the fact that a celibate character (who, after all, engages "the normal behavior of unmarried people") is homosexual. Guy *Anybody else read Piers Anthony novels as a teenager?

Forest will grow back... A better question is whether it makes sense to have people living in a tinderbox. Are people who live in these areas of CA required to purchase insurance against wildfire damage? Guy

A rational scheme? Not quite sure what you mean by that....Are you saying it's too cheap per gallon? I guess we could up the price some, but I feel that would be too little too late...Most people haven't been able to water their lawns for most of this year. Can't wash cars anymore, and probably won't be able to til next year at the very earliest. We can take shorter showers, but most people don't want to stop flushing toilets. For many a year all you can get is low flow shower heads, and toilets. Businesses on the other hand... at least up til a few weeks ago, I would see them running their sprinklers all the time to water a 2, 3 foot strip of grass We are a city growing faster than any other large city in the nation, and no one has been planning for what can/will happen with this kind of growth. Plus, Gatorade is the largest water user in Atlanta. And as I have mentioned a few times, the Army Corp of Engineers seem hell bent on draining the lake, or at least pumping it to a point water pressure will be non existent. For all the screw ups mentioned in the last article, they screwed up last year as well and dumped billions and billions of gallons of water to help some sturgeon, not realizing that they had measured the water level incorrectly! We are in a drought, a terrible one. We have been in and out of droughts for most of this century, and you just think that people at the state and Federal level would have a clue on how to handle this situation better. Beri, What I meant was... I know that in California and lots of other places, water is heavily subsidized to at least some users. (In Cal and Israel, farmers pay an tiny fraction of what others do.) I do not know if Atlanta residents pay the actual cost of the water they use, but yes, some sort of hike in the price of water would help alleviate some of the problems with the shortage and also potentially generate a market-driven solution to the water shortage. Guy