Sunday, 20 December 2015

Gregory Mankiw and the $300 Textbook

Mankiw is trying his best to increase income inequality. How can he justify the price for his textbook, esp as the 7th edition should mean that he has already reaped a high enough revenue stream through the previous editions.

Tuesday, 8 December 2015

ABP to introduce 'Carbon Budgets'

Does it really make sense to introduce 'Carbon Budgets' as a constraint on the mandates for Asset Managers? First of all, the calculation of carbon usage for all investment options is expensive and it is also more than likely to be imprecise or liable to be gamed. And why not a Carbon budget for fixed income investments (even more complicated and expensive, how much Carbon usage to you allocate to a bond?), and before we forget, I hope there will be Carbon budget for 'Private' Equity and Hedge Funds? And last not least, don't forget the HFT firms. And what about Bank lending?
Nevermind that there is a simple solution at hand (Tax Carbon if you are hell-bent on limiting its use). Why not act according to the principle, what is good for the Consultants MUST be good for the Consumer (here in the shape of hapless end investors in Mutual and Pension Funds, Private Banks and Insurance Companies).
And while we are on the subject of Climate Hysteria, has any political or business 'leder' ever received a democratic mandate for imposing ever-more 'green' taxes, costs and regulations on the citizen/consumer/investor anywhere in the world?

Friday, 4 December 2015

Saving Capitalism?

Interesting contribution to the debate about Inequality. But misses some key aspect: there is a myriad of micro-economic and legislative decisions that need to be adjusted: Copyright Laws, Governance of Corporations, Competition Regulation etc.

Are they really stupid at the ECB?

The believe that pushing inflation up to 2 pct will really make one iota of difference to the economic well being of millions of Europeans can only be described as stupid. If anything, workers will be worse off in real terms, as will be savers. So consumption will in all likelihood be on a downward trajectory. With respect to 'structural' reforms, maybe the ECB should first look at itself: what benefit have the people of the Eurozone gained from employing thousands of overpaid jobsworths in the super expensive tower that accommodates them in Frankfurt? Does one notice any difference from when the countries had their own currencies?

PS: Just spotted Bill Gross' opinion about Fed Policy, so I am not alone with my opinion!