Sunday, March 25, 2007

Economics and Social Policy - XXXVII

Welcome to the March 25, 2007 edition of Economics and Social Policy. After being weekly for 36 weeks, I’m switching over to a bi-weekly format. Hopefully, this will a) mean a spread out workload for me, and b) lead to a consistently higher quality of posts, and carnival.

Special section on Sub-Prime mortgages. An idea so bad only an MBA could have thought of it (And I’ve got one!):

Alex at The RE Forum presents Lowest Common Denominator Laws And the Subprime Lending Market posted at The RE Forum, saying, "As the Hill tries to legislate out of the subprime mess, why is no one talking about the 90% of subprimes who are performing on their notes? Should 100% of us be held to standards that are designed for 10% of the population?"

Well, probably because the 10% is perceived to be (rightly or wrongly) the tip of the iceberg. At the end of the day, Congress is all about perception. And for that matter, so is the market. As for Congress’ overreaching on legislation to punish a few, I have two economy crippling words for you: Sarbanes. Oxley.

Murad Ali presents Housing Forecast: Decline & Foreclosure posted at The New Business World.

More on the mess. From a lender’s perspective, what made anyone think that a 100% ARM interest only loan was a good idea? Probably the notion that the government would cover their fanny maes with things got tough.

Michael Cook presents Will Sub-Prime Lending Affect You posted at Suite101: Mortgages/Loans articles.

A nice description of what sub-primes are. The answer, depending on whether or not the worst case scenarios come to pass, is probably. Better that we bundle these loans up and sell them to China.

Other topics:

Jamila Akil presents We Don't Need Universal Health Care Pt. I: Why Does The US Have Such A High Infant Mortality Rate ? posted at Jamila Akil.

A detailed piece on infant mortality. I’m always amazed that people think that medicine will get better once we put a combination of the post office and IRS in charge.

Phil B. presents Think Before Donating « Phil for Humanity posted at Phil for Humanity, saying, "How can people, who are in debt, feel comfortable donating?"

Well, you should always think before donating. And most Christian churches don’t demand tithing. The Biblical teaching is to search your heart, and give as the Spirit directs. That said, the church should be the first line of support for the impoverished member, not the government.

Alvaro Fernandez presents "Tis better to give than receive": oxytocin and dopamine posted at SharpBrains.

A bio-mechanical reply to Phil B., with all of the limitations that that implies. But she’s only 15!

Tom Blumer presents BizzyBlog » Are Millions of Americans Saving TOO MUCH for Retirement? I Doubt It posted at BizzyBlog.

A great post. Save too much? I wish I had that problem. Of course, you should watch the kinds and amounts of fees you pay to brokers and financial planners. As Boring Daughter #3 might say, “well, duh”. But save too much? Ha. Think of all kinds of unplanned for expenses. Trips you might want to take. Providing for your heirs and charities.

Nothing is easier to get rid of than money. Most of us don’t seem to be struggling against being misers.

Brent Diggs presents The Biggest Secret of the Federal Reserve, Exposed! posted at The Ominous Comma.


David Gross presents The Picket Line — 6 March 2007 posted at The Picket Line, saying, "How "privatizing" government leads to public financing for the campaigns of incumbent legislators."

Dear Mr. Gross: A good working assumption about any legislator’s priorities are a) getting re-elected, and b) getting re-elected. That’s it. Privatization? Not a major issue outside of conservative / libertarian circles, mostly because it reduces the scope of government. And government unions. And corruption. As an example, look at the Dept of Education.

Matthew Paulson presents Don’t Try to Save Money On Food. posted at Getting Green.

Key point: “When it comes to our money, the psychology of our plan has to work just as well as the mathematics.”

Praveen presents Gross-Receipts Tax posted at My Simple Trading System.

Gross receipts taxes are always bad. Similar to the income tax, they are unconnected with profitability. And since the existence of the business depends on profits and cash flow, not gross receipts…

Wenchypoo presents Moooove over, Bossy—A New Nutrition Game is in Town posted at Wisdom From Wenchypoo's Mental Wastebasket.

I’d never head that dairy was the sole source of calcium. And I suspect that most people understand that too much dairy consumption isn’t good for you.

But Ice Cream, Cheese, and Yogurt are wayyyyy tasty.

Ybother presents 10 Ways Retailers Make You Pay More! posted at Daily Top Ten List to jumpstart your knowledge.

A nice summary of pricing strategy.

That concludes this edition. Submit your blog article to the next edition of Economics and Social Policy using our carnival submission form. Past posts and future hosts can be found on our blog carnival index page.

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