Michael Maiello's picture

    Equifax and the CFPB

    Two days before we found out that credit reporting agency Equifax had been hacked and 143 million consumer records were compromised, I received an alert from my credit card company that somebody had attempted to buy $200 worth of merchandise at a Foot Locker in Queens.  Later, the Equifax website did acknowledge that my information may have been compromised.  I took the necessary steps to change cards and passwords.

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    Michael Maiello's picture

    Record Levels of Median Income (Not What It Seems)

    Last week, we learned that the median household income in the U.S. 2015 had jumped by around 5% to $56,000 a year. The news was greeted with good cheer and David Brooks even wrote a column in the Times proclaiming that capitalism is not broken.

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    Trade Policy Reality Check - neither Scrooge nor Sucker

    I've noted this over and over, but maybe this one will get through. Below's a chart showing the largest countries. The 2 largest are down at the bottom with pathetic GDP per capita of China's $10K and maybe $4K for India. China has roughly 5x our population, India 4 1/2x. And while their income is awful, China's rose about 500% from super awful over 25 years, while India's has more than tripled.

    For some reason we're not able to ever think of that as *OUR* success, that rather than sending Bibles and powdered milk, we have found a real way to lift almost 3 billion people out of poverty in just 2 countries, and it certainly doesn't end there.

    Of course much of the credit belongs to them - cutting their birthrates drastically, producing productis and services that are wanted by the rest of the world, steady incremental improvements and attention to obvious areas like infrastructure & education, and less obvious ones like government regulations & judicial reform and various human rights. In the meantime, the last 8-10 years, we've been flat.

    Jobs, Jobs, Jobs (per AA anonymous)

    All this jobs jobs jobs talk is starting to get to me when I am constantly reading about extremely low unemployment all around the country. including in red states like Wyoming. What happened is that someone learned to play a wicked poker with the Electoral College by targeting some pockets of long-time resentment about jobs lost 20 years ago or more, places that have not adjusted to reality and refuse to move anywhere but want obsolete jobs to come to them and want to stay in their hood and never change. Likewise we are told we need to cater to the needs of poor segregated minority communities, they don't want to move and mix, want to keep their culcha, but want jobs and services to come to them without paying a lot of taxes. Meanwhile immigrants are willing to come across the world to work and live here. Absurdity after absurdity.

    I know, don't need to say it, it's about well-paying jobs that restore the middle class. But that's not going to happen without education anymore. Not anywhere in the world. (If it ever really did. I grew up in a poor white hood in the late 50's and early 60's where uneducated dad's were always being "laid off" of "third shift" at the factory, so they could never afford to get out of slummy rentals, they kept having kids nonetheless.)

    Maleing it in: Masculine Mystique & the Savior Complex

    Elaine Chao, Washington veteran, noted at Politico's recent "Women Rule" that, 'Men don’t prepare that much, so why do we have to?' and continues "“I prepare so much more than some of my male colleagues,” Chao tells POLITICO editor Carrie Budoff Brown in the latest “Women Rule” podcast interview. “And I know women who are prepared more and we get ridiculed and it's like, ‘Oh, my gosh. She's just preparing so much. She's such an automaton. Can't she just like, wing it?’”"

    The reason, of course, is our millennia-old mythos of men being born for glory and greatness, ready to roll, walk-ons for greater things. We call this "The Natural", like that Robert Redford movie.

    You might think of it as Magic Johnson vs. Larry Byrd - roughly comparable skill & success, but in popular lore largely "the guy with the screaming God-given talent vs the Hoosier who always had to work so hard". 

    Charting Progress: Workers' Pair of Dice

    In discussing Kaep & whether he's being blackballed, I came across some graphs at Business Insider showing the typical NFL player's increase in salary - and the steadily decreasing chance he'll make it there:

     

    And then I thought of the implications for workers in general - what's our expected salary and performance trajectory, how many times will we be "traded", or have bad seasons or not make the cut in spring training and be pushed down to the minors?

    Where would *you* chart? Because we have the technology, the analytics to chart *everyone*, whatever industry. Like in sports, we have a window of productivity, peak performance, and then we often fall off or find a different groove and work from there.

    Too Big to Fail: Why Government as a Business Doesn't Work

    Much is being written about Jared Kushner leading another task force to make government run like a business, with the usual caveats about how it's likely to fail. Included are all the usual right and wrong reasons about government not being a business. But the lack of failure is the biggest point.

    American business is successful precisely because so many businesses fail, and are replaced by new trendy companies with just as much chance of failing. Amazon, one of our great recent "success" stories, didn't make a profit for years, and now 20 years later only pulls in profits of maybe 1% of revenues. Uber's much worse, with a 2016 loss of perhaps $3 billion. It's hard to imagine US voters putting up with such poor results. And those are the *good* examples.

    Doctor Cleveland's picture

    Brexit vs Breakfast: Food and Free Trade

    The United Kingdom officially triggered Article 50 today, meaning the two-year march to Brexit has begun. The UK is leaving the European Union, and leaving without any concessions, any deals, any accommodations. It's the "hard Brexit." There are many reasons this is a bad idea, but let's keep it simple: the United Kingdom cannot feed itself.
    Danny Cardwell's picture

    Snowy Roofs And Cheap Oil

    A few years ago my wife and I had a new roof put on our house. During a casual conversation with one of the contractors I learned that snow can be much more damaging to a roof than rain. The heat that rises through the attic or crawl space can cause ice dams. Once ice dams are formed water seeps into the crevices of shingles and flashings. The picturesque snow that sits peacefully atop your house can do more damage than the heavy rains that accompany violent tropical storms and hurricanes.

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    Doctor Cleveland's picture

    Your New Year's Public Domain Report for 2016

    Happy New Year! It's Public Domain Day, the first day of the calendar year, on which people in other countries get new works of art and learning added to the public domain for everyone to use. And on the first day of the new year we in the United States get ...

    Zilch. Nada. Niente. Nothing.

    Again.

    Doctor Cleveland's picture

    What Is a "Good" College? Two Tentative Answers

    Sometimes, because of my job, people ask me advice about choosing colleges. It's always nice to be helpful, but talking about college reputations can be a minefield. Obviously, you learn quickly that you should never put any college or university down, but that's not enough. People can also get very prickly when you don't praise a particular college enough.

    Michael Maiello's picture

    What Ruth Marcus and Brookings Don't Get About Microeconomics

    Thanks to Hal for referencing The Washington Post's Ruth Marcus on Hillary Clinton the other day.  I don't read Marcus too regularly, but when I do, it reminds me why not reading her is probably an IQ booster.

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    Michael Maiello's picture

    Our Continued Demand Slump

    The world economy still suffers from a global lack of demand.  That's what caused the market correction in China that sparked a (temporary?) contagion in the rest of the world.  When it comes to the economic basics -- energy, grains and metals, everything's in a bear market.  The Daily Beast asked me to write about the markets and I took my stab. Basically, I think that China is deflating too early.

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    Michael Maiello's picture

    Financial Illiteracy and Bill Clinton's "Secret Company"

    The right wing is all agog about Bill Clinton's "secret" company called WJC LLC.  The "secret" company, which has twice incorporated itself with public documents naming Bill Clinton as its majority shareholder in two states (New York and Delaware), is not actually a secret company at all.

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    Michael Maiello's picture

    Re-Free Martha Stewart

    This week brought news that five large global banks had admitted to felonies and agreed to pay $5.6 billion in fines to the U.S. Treasury for colluding to rig global currency markets.  The amount of the fines captured headlines but the amounts are actually relatively small.

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    Michael Maiello's picture

    The Flash Crash Boy

    When I was at Forbes I learned that the American Stock Exchange, once known as "the curb," also had the nickname, "The Scam-ex."  This was where people bought and sold shares of subprime public companies and where insiders and bucket shops conducted pump and dump scams on retail investors.

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    Michael Maiello's picture

    How WalMart Fooled The World

    Yesterday, The Daily Beast asked me for my take on WalMart's big "wage hike." WalMart raised its starting wage to $9 an hour across all locations, with the goal of getting all of its 1.4 million employees to $10 an hour next year.  The company handled the PR very well.  From the press I saw, you'd think WalMart had grown a heart, that economic conditions had improved for our lowest wage workers and that the system basically works.

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    Doctor Cleveland's picture

    Against Rock Stars

    This summer, I went to a Cleveland Indians game which involved a pregame celebration for Johnny "Johnny Football" Manziel. [Full disclosure: I am a lifelong Boston sports fan living in Cleveland. Although I sometimes go to the Jake just to watch the Indians, I was there that night because my Red Sox were in town.] Everybody in the building seemed to be deliriously excited about Johnny Football. Everybody was making his little money-fingers gesture.

    Michael Maiello's picture

    Why Is Brookings Pushing Scammy Annuity Products?

    On Saturday morning, a Tweet from Brookings caught my eye.  It suggested “Longevity Annuities” would be a great solution to the post-pension problem of longevity risk.  This is such an unbelievably bad idea that my first thought was that some insurance company had corrupted Brookings.  I see no evidence of that, however.  It’s probably just a case of two Hamilton Project thinkers who are overly in love with private industry solutions to truly public problems.

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    Michael Maiello's picture

    The End of QE and the Bret Easton Ellis Era of Monetary Policy

    Quantitative Easing, we hardly knew ye, and now ye are gone without a lot of people even knowing what ye did or how ye did it. Well, here were some of your effects.

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