Money velocity. Wow. I can’t believe I just learned about this, and I suspect that political scientists and political economists are–once again–way off in their data choices. Several of my own past projects would benefit from redoing the analysis with money velocity rather than GNP, etc.
Tag Archives: finance
The Worst The Economist Argument Ever
Most bastions of good journalism have taken a terrible fall during the past ten years, especially The Economist. But the fall has never been so well illustrated with this quote from one of the Home Truths leader in the May 10, 2008 issue of The Economist that argues Congress should bail out “homeowners” who face mortgage problems:
…there is a case for government intervention to avoid unnecessary foreclosures. Evicting a homeowner and selling his property takes months, during which vandalism and legal fees can destroy a large part of the home’s value–and drag down the price of the neighbours’ homes as well.
Vandalism and legal fees? Did someone forget to edit this article? Or maybe they just forgot to think before writing.
Equally disturbing is the use of “homeowners”? Are we so blind we miss the problem of calling individuals who can’t pay their mortgages “homeowners”?
Credit Madness
The lack of fiscal responsibility on the part of those living in the United States is not news. Whether it is the total lack of savings (the current rate of personal savings of disposable income is negative and has been strongly declining for many years) or credit card debt, as a whole we have a large appetite for consuming.
In reading the details of my new credit-card rewards program–I switched cards because of Bank of America’s terrible customer service for my former-MBNA card–I realized this spending is no longer limited to money. You can now borrow reward points from credit-card companies to have enough points to “own” that new grill, “pay for” plane tickets for your vacation, or receive Blockbuster gift cards for “free”. But if you do not borrow enough using your rewards-program credit card, thereby properly “earning” those points, you will be billed at an exchange rate determined by the credit-card company.