The middle class radicals who have forced the end to democratically-elected governments* in Thailand have not done Thailand any long-term favours. Recent events in fact constitute a middle-class coup that has driven a popularly elected government from office. That is true even if the government was not entirely saintly. Read more »
Last year I deviated from my standard summer routine by holidaying in Sydney rather than in Ulladulla NSW where I have enjoyed my holidays for most of the past 20 yea Read more »
The reports of the overnight killings in Mumbai are horrifying. The image of religiously-motivated young men searching for totally innocent civilians with American or British passports and then killing them because they originate from these particular countries makes all civilised humanity recoil. Pure evil.
Sympathies for the 82+ dead innocents and for the 400+ injured and something approximating a prayer for those held hostage by these evil men.
On July 14 2007 I tipped a possible takeover bid for Rio by BHP-Billiton. Read more »
Indonesia is the third-largest greenhouse gas emitter on the planet - after China and the United States. The vast bulk of its emissions are caused by deforestation of its tropical rainforests - particularly in central Samatra. Deforestation emissions in Indonesia are about half the total emissions of China. Read more »
The Dow Jones last night fell another 5% to end up below 8,000 - its lowest level for 5 years. Banking stocks were again savaged as were auto producers - a large slab of the US auto industry faces the prospects of collapse. In addition the US is experiencing deflation - the US CPI dropped 1% in October. Read more »
Most academics believe that US universities are among the best in the world - of the top 20 fully 17 are supposed to be in the US. Yet in many respects American society is ignorant. It is a paradox that presumably reflects a divide. Read more »
The recent case where parents with a child having Down's Syndrome were excluded from migrating permanently to Australia has aroused much emotion. It is widely seen as discrimination against disabled people. It is nothing of the sort. Read more »
This is a guest post by Rabee Tourky, Professor of Economics at the University of Queensland
In a previous post on this blog I began describing how to my mind the market failure associated with the financial crisis has to do with market incompleteness. That is, we found ourselves in a situation in which one could not use the available securities to diversify away from certain risk.
I'll take the opportunity to refine, in a loose way, my market incompleteness argument. Read more »
The recent issues of Quadrant that provide only ‘denialist’ views on climate change issues must leave those concerned with the implications of climate change feeling shocked. Quadrant could analogously act as an outlet for the flat earth society but the purposes of supporting such a sustained attack on scientific logic would make no more sense than supporting climate change denialists without offering anything in the way of the majority accepted-science contrary view. Read more »
I have had a fascinating and enjoyable visit to China. I spent a month here in 1988 but, Beijing at least, is an entirely new city now. I am sometimes not a great supporter of Chinese policies but, to their credit, the achievement of the Chinese authorities in constructing the new Beijing is in many respects remarkable. Beijing is modern, swanky and would be even an attractive place to visit as a tourist. Read more »
I am spending the next week in Beijing attending the Beijing Forum while staying at one of the oldest - and best - academic institutions in China, Peking University. On Sunday I am presenting a paper ‘Strategic Issues in Global Climate Change Policy: an Economic Perspective’. Read more »
This panel discussion (George Soros, Nouriel Roubini, Jeffrey Sachs) moderated by CNN's John Roberts on saving the global economy. You need to reserve some time - its about 90 minutes - but worthwhile.
This is a guest post by modest, Sydney-based journalist Sir Henry Casingbroke. Sir Henry previously contributed this related post.
I am surprised how little discussion there has been about one of the most obvious and painless ways of doing something practical about emissions of CO2 into atmosphere.
The main problem lies with electricity generated by burning coal followed by internal combustion engines using petroleum products. Read more »
Robert Shiller - the 'rational exhuberance' man - sees speculative bubbles as an instance of 'group-think' (yes, that is well-known) where, among experts, few will stick their neck out to present a divergent view. It seems that taxi drivers with basic powers of observation (their eyes open?) ca Read more »
The Australian Treasury document Australia's Low Pollution Future is a major study of the economics of greenhouse gas emission control for Australia. It deserves a careful reading. In the main it argues that Australia gains some 'first mover advantages' from dealing promptly with climate change on the assumption that all countries will eventually control their emissions. Thus it is optimistic about the implications of carbon leakages. Read more »
PM Rudd loves the dramatic gesture that has symbolic effect - 'apologising' to aboriginals for the claimed sins of our ancestors, ratifying the soon to be irrelevant Kyoto and, last weekend, posing for that inspiring snap of himself - shirt sleeves rolled up - 'getting down to work' with Ken Henry. A man of action! Read more »
An interesting story that I have known about for years - but which has only just resurfaced - oxycodone is replacing heroin as the drug of choice among former heroin users. It has most recently resurfaced at Sydney's "Safe Injection Room" AKA the Labor Party shrine to Stupid Public Policy. Read more »
I have been heavily involved in other things and too busy to make a comprehensive update on the crisis. My last long post on it took a lot of time to write - I presented some of the material at a La Trobe University seminar organised by the SRC and the radical group Socialist Alternative. Read more »
This is an amazing interview with Soros. A fan of markets he nevertheless sees deregulated financial markets as delivering a biased reflection of reality that generates booms, busts and bubbles. The reason - too much credit, too much leveraging. Free market fundamentalism is just as misguided an ideology as socialism. Read more »
I find it hard to support war hero John McCain and his dud Vice Presidential candidate Palin. But Obama is no shining angel either. 100 prominent US economists get stuck into Obama's policies on tax and trade (a longer list is here): Read more »
Kevin Rudd's $10 billion fiscal expansion package makes some degree of sense as a preemptive way of offsetting the impending effects of a (likely) impending international recession on the Australian economy. This move will complement the recent interest rate cut and the dramatic decline of the Australian dollar as a means of stimulating the economy. Read more »
Equity markets around the world have fallen dramatically over the past week as fear of the next financial disaster or just fear of the pure unknown has taken hold. I have no idea what will happen or how long the current crisis will prevail - indeed I am unconvinced anyone does - but I have a few tentative ideas about the current situation at least with respect to equity markets. Read more »
This quote from the Times Online just about says it all: Read more »
The Swiss have legalised the prescription of heroin to addicted users. The measure apparently has 68% Swiss community support although 63% oppose the legalisation of cannabis. Read more »
160 countries have refused to admit cancer producers into discussions on limiting the global spread of cigarettes. The countries argued there is a fundamental conflict between the interests of public health and those of cigarette producers. That is obviously true. Read more »
$10 million to resurrect the mammoth? It is better to concentrate conservation resources in attempting to limit current species extinctions than to engage in resurrectionist science that has almost no chance of success. There will not be a mammoth coming to a zoo near you soon.
Over at the East Asia Forum blog two useful articles on climate change: Read more »
Chapter 11 is the best outcome for GM since it will permit the types of restructurings that are currently impossible given union demands for taxpayers to pay their member’s salaries and state resistance to plant closures. The US autoworkers were big financial supporters of Obama’s election campaign and for good reason. An aid package from the US Government won’t fix things. Read more »
I said that Barack Obama would be the US President when it was unpopular to say so. This video interview with CBS confirms my belief that Obama may well be a great US President. Read more »
My paper Classical Decision Rules and Adaptation to Climate Change suggests ways of thinking about adaptation decisions in practical climate change settings where probability information is poor.
1 dozen fresh oysters with lemon and a side salad of tomato, lettuce, sliced kiwi fruit and orange.
2 dozen lightly-grilled, skewered prawns spiced sparingly with mixed herbs.
More than 1 glass of Yalumba Viognier 2007.
The sun outside, beating down, defeats any vague thoughts of mowing the unkempt lawn. Golf if it cools a bit.
The upside to the downside of being back in Oz.
Gregory Mankiw points out that Barack Obama supports the conscription of youth into community service. I wonder how many aged lefties will now dump on Obama on the basis of past Vietnam Moratorium ideals. Well of course its not this aged lot who now face the prospect of being conscripted so that a certain amount of soundly-justified hypocrisy is plausible.
Maybe spending the last week in China has dented my democratic ideals but I think the Obama suggestion makes a lot of sense.
In hindsight the RBA overreacted to inflation in making interest rate hikes up to March 5 this year when rates peaked at 7.25%. After being cut by 100 basis points last month they were cut by another 75 points today to be 5.25%. Read more »
Robert Solow is one of the most entertaining - and perceptive - economics writers I know. He also has a zany sense of humour but that is another story. Read more »
This Commentary article by John Gordon puts the current financial crisis in historical perspective - specifically relates it to the US banking crisis of 1836 - and identifies the main regulatory/political failures. A quality 'conservative' assessment.
I forecast that Barack Obama would be the next US President when it was unpopular to do so. Of course given the polls I am happy to retain this forecast as evidence of my luck or prowess now. Read more »
This is experimental folk music with some class. Good lyrics, listen! Interesting stuff. I also liked this view of the talking chimp.
Guest post by Professor Rabee Tourky, University of Queensland
These are interesting times for economists. I hardly know a serious economist whose attention in the past weeks has not been fixed on the changes in assets prices. Read more »
Will Europe initiate a new wave of problems from the financial crisis? The focus is on the collapsing bubbles in emerging markets (and here) and their implications for what are mainly European lenders. Read more »
I noticed in today's press that a large number of fairly expensive houses being put up for auction in my suburb yesterday and that all were passed in. The story was much the same across Melbourne. Read more »
'I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around the banks will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered.'
Thomas Jefferson 1802 Read more »
One of the refreshing incidental features of the current financial crisis is that many economists are displaying an uncharacteristic humility. They don't know what is happening and they know that they don't know. Humble pie is also being eaten on theories that our real savings are boosted by capital gains on the stock market and in house prices. I have even gone a bit quiet myself on the irrelevancy of current account deficits although still thinking about this one. Read more »
I glanced at the All Ordinaries at 10-25 am today and the index had fallen just under 6% in 25 minutes. This is fearful stuff. Last night the S&P on Wall Street fell 9% the biggest decline since 1987. Oil prices have hit a low of $75-90. Read more »
This is stunning, grotesque, entertaining.
John Quiggin seems enthusiastic about the prospects for more 'utopian' society with government-controlled major banks. As much as I am deeply concerned with the very recent claims of imminent global financial peril I do not share his enthusiasm for this at all. Governments might well wish shore up the capital base of large banks in Europe or the US by subscribing to equity (voting or non-voting) but this should be sold down ASAP. Read more »
One of the most despicable anti-Australian policies of the Hawke-Keating era was the devotion to bring in many unskilled immigrants into Australia under the guise of the 'Family Migration' Program to bolster Labor's standing with the ethnic lobbies. Whenever the global economy faltered those in the Labor Party with high immigration targets based on re-election objectives brought into Australia primarily those with a family link here. Read more »
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