Tuesday, January 29, 2008

Economics and Social Policy – XLIII

Welcome to the January 29, 2008 edition of Economics and Social Policy. Lots of good, thought provoking posts in this edition, so let’s dig right in.

Samuel Bryson presents Free Market Economy/Classical Liberalism Vs. The Welfare State – Which is the better ideal? posted at Total Wellbeing.

An interesting comment. As a ‘classical liberal’ (in America, that translates to ‘conservative’) I have very little faith in the notion that the welfare state can be made to run efficiently, or that it won’t create a long term drag on both the economy and freedom.

I also tend to believe that it’s not free markets that make men greedy and competitive. Men are greedy and competitive as part of their inherent nature. All the market does is provide a way to transform greed an competitiveness into a net social benefit.

Jose DeJesus MD presents The Market Crash America Missed posted at Physician Entrepreneur.

It’s certainly true that panic selling is not a winning strategy – just ask the Societe Generale. We’ve also benefited from the recent interest rate cuts, and the fact that most of the underlying fundamentals simply aren’t that bad.

And I would never expect the Fed Chairman to say anything to Congress that didn’t qualify as obvious. Well, obvious to most, but not to most congressmen.

Raymond presents Looking Forward To Receiving and Not Spending My Economic Stimulus Rebate Check posted at Money Blue Book.

Like Raymond, I don’t think the tax rebates are actually going to do much good for the economy. Also, like Raymond, if I get a check, I’ll happily cash it. Lack of aggregate demand doesn’t seem to be the core problem facing the economy, so this is more of a PR stunt in search of a problem than an actual solution. Will (see post below) isn’t crazy about the notion either.

Ted Reimers presents Student Debt in America posted at CampusGrotto.

Student loans – tread carefully. I think that we can confidently predict that as Congress increases subsidies to students, the costs of college will rise accordingly, probably with a corresponding decrease in actual education delivered.

Sagar presents 50 Tools and Resources for Freelancers During Tax Season posted at Bootstrapper.

It’s tax time. Sigh. Lots of useful stuff on taxes, documentation, deductions, etc., in this link-fest.

Nigel Swaby presents The Economy is Getting Really Ugly posted at Salt Lake Real Estate Blog.

Yup, it’s a bad time to be in the real estate business. Certainly, the revaluation of residences has taught many Americans an important, but painful lesson: Prices move both ways. Still, it’s not 1929. We have yet to see the Fed cut the money supply by 25%, or to have Congress pass serious trade restrictions to crater international trade (though that’s certainly possible after the 2008 election cycle).

Warren Wong presents How To Learn To Make A Good Investment posted at Personal Development for INTJs.

When making investments – either in the market or yourself – don’t let the perfect become the enemy of the good. For most people, a well managed mutual fund is the way to go over holding individual stocks. That said, it’s perfectly plausible to be able to find good companies based on publicly available information. You’re probably not going to earn Warren Buffett returns, and some positions will turn out to be losers. Over the long term, equities should probably be the bulk of your portfolio (unless you expect hyperinflation).

Wenchypoo presents Will the Real Economy Please Stand Up? (L-O-N-G) posted at Wisdom From Wenchypoo's Mental Wastebasket.

I’m not sold on consumer spending as a driver of the business cycle, and even less sold on the tax rebate as a remedy. For that matter, no one this week was willing to fling their beret in the air over that idea.

Will's Perspective presents Socialized Medicine: Replacing Health with Politics and Economic Manna and Utopia - In a Political Mind.

There’s no such thing as a free lunch, free medical care, or a free economic stimulus package, and Will provides documentation of this well know, but oft ignored, fact.

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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