Month: December 2009

Why should the “real” economy be affected by chaos in the financial sector?

Posted by

0

Brad DeLong on the linkage between the real world (where people make things and provide services) and the financial world (where people move pieces of paper around). The linkage has always struck me as overly strong, although intellectually I understand it. (I studied economics at MIT when Bob Merton and Fisher Black were active instructors there. I was required to believe it makes sense.) He provides a good reminder of why the linkage exists, and its effects in setting off the current recession. An excerpt:

This crash in prices of risky financial assets would not overly concern the rest of us were it not for the havoc that it has wrought on the price system, which is sending a peculiar message to the real economy. The price system is saying: shut down risky production activities and don’t undertake any new activities that might be risky.

But there aren’t enough safe, secure, and sound enterprises to absorb all the workers laid off from risky enterprises. And if the decline in nominal wages signals that there is an excess supply of labor, matters only get worse. General deflation eliminates the capital of yet more financial intermediaries, and makes risky an even larger share of assets that had previously been regarded as safe.

via Project Syndicate – The Fairness of Financial Rescue.

(More discussion in DeLong’s blog

Climate promises are easy to make, but hard to keep

Posted by

0

My upcoming BGGE course will have some major projects on climate change negotiation, so I’ve been reading about recent developments more than usual. As usual,  Bjørn Lomborg has some intriguing ways of slicing the numbers. Unlike the old days, GCC deniers won’t get much comfort from him, though.

To be sure, Europe has made some progress towards reducing its carbon-dioxide emissions. But, of the 15 European Union countries represented at the Kyoto summit, 10 have still not meet the targets agreed there. Neither will Japan or Canada. And the United States never even ratified the agreement. In all, we are likely to achieve barely 5% of the promised Kyoto reduction.

To put it another way, let’s say we index 1990 global emissions at 100. If there were no Kyoto at all, the 2010 level would have been 142.7. With full Kyoto implementation, it would have been 133. In fact, the actual outcome of Kyoto is likely to be a 2010 level of 142.2 – virtually the same as if we had done nothing at all. Given 12 years of continuous talks and praise for Kyoto, this is not much of an accomplishment.

The Kyoto Protocol did not fail because any one nation let the rest of the world down. It failed because making quick, drastic cuts in carbon emissions is extremely expensive. Whether or not Copenhagen is declared a political victory, that inescapable fact of economic life will once again prevail – and grand promises will once again go unfulfilled.

via Project Syndicate – Climate Change and “Climategate”.

The IPKat – happy to serve the IP communities: Letter from AmeriKat I: Happy Holidays!

Posted by

0

Can anyone point  to more blogs on intellectual property  issues? Most of what I have found is industry-written and one-sided. Pamela Samuelson at Berkeley does not appear to have a blog. This is an area where academics are surprisingly consistent, but we don’t seem to be doing much talking about it. (Most academics I’ve talked to agree that current IP protections are much stronger than is good for society in general.)  Here’s one note that I found:

In Geneva last Tuesday the Obama administration announced before a subcommittee of WIPO that it supported the WIPO Treaty for Sharing Accessible Formats of Copyright Works for Persons Who are Blind or Have other Reading Disabilities. The Treaty would lessen international copyright protection in order to enable cross-border distribution of DRM-protected digitized books that blind and visually disabled individuals can read with tools like Pac Mate and Victor Reader. …..

Such a move, of course, puts the administration at odds with many US industries including software manufacturers and motion pictures.

via The IPKat – happy to serve the IP communities: Letter from AmeriKat I: Happy Holidays!.

Here’s another site that looks relevant:

http://www.publicknowledge.org/blog

Thanks.

How to lie with statistics – example 322

Posted by

0

Paul Kedrosky reproduces some data on supposedly  fast growth industries:

According to a new study, here are the best and worst performing industries of the last decade as measured in revenue percentage change terms. Here are the leaders:

source: http://www.ibisworld.com/

Some of these are doubtless valid, but the top 4 are all industries that had virtually no revenue at all in the 1990s, since they basically did not exist were not measured until Internet companies started to go public.  It’s easy to have an astronomical growth rate if you make the base number small enough. Startups do this a lot – “our revenue grew 1500% in our first 2 years.” That could mean they had $1000 of revenue in year 1, and $15000 in year 3!

“Anonymized” data frequently isn’t

Posted by

0

An in-the-closet lesbian mother is suing Netflix for privacy invasion, alleging the movie rental company made it possible for her to be outed when it disclosed insufficiently anonymous information about nearly half-a-million customers as part of its $1 million contest to improve its recommendation system.

The suit known as Doe v. Netflix (.pdf) was filed in federal court in California on Thursday, alleging that Netflix violated fair-trade laws and a federal privacy law protecting video rental records, when it launched its popular contest in September 2006.

via Netflix Spilled Your Brokeback Mountain Secret, Lawsuit Claims | Threat Level | Wired.com.

(As the article goes on to make clear, this problem has been known for a while. Netflix ignored it at its peril.)

How compressed are computer games?

Posted by

4

The Digital Society blog raises the question of bit rates for computer games.

The study assumed that computer games were effectively compressible to 100 Mbps which the researchers say is 8 times higher than HDTV.  But I don’t know how this number came about since computer games (even the most realistic) are not as realistic as live video due to the lack of details.  This is why even Hollywood has a hard time convincing us we’re looking at live shots instead of computer graphics.  Compression is an arbitrary number because we can choose any level of compression level we want depending on how [much] data we are willing to discard.

Actual 1920×1080 resolution gaming requires 3000 Mbps of data going from the video card to the display and at no time is it ever compressed

We spent a lot of time investigating this issue; as the post says, it has a big effect on our total byte estimate. Continue reading →

The Myth of Dick Fuld « The Baseline Scenario

Posted by

0

Wall Street defenders like to point to Dick Fuld, who supposedly lost $1 billion by holding on to Lehman Brothers stock that eventually became worthless. You don’t get more of a long-term incentive than that, the argument goes.

Lucian Bebchuk, Alma Cohen, and Holger Spamann have exploded this myth in a Financial Times op-ed and a new paper.

via The Myth of Dick Fuld « The Baseline Scenario.