Brazil's currency took a nosedive this week. Investors, and the world in general, are concerned what the new Finance chief there is going to do. Since they seem to be unsure of what they guy is about, naturally they panic and cause a currency crisis.
This is why measured words are so important for our Fed chief. These hysterical ninnies in the financial industry will take any excuse for an emotional bender and play it to the hilt. Econo-Girl often finds that the people hiding behind numerical analysis are just a lot of twits that are extremely reactive.
Take the Law and Economics theory. It basically says that every legal decision should be decided by a cost/benefit analysis. Hmmm. Great way to look at the Bill of Rights. And of course, anything they decide they want somehow gets the best results and wins their 'objective analysis'.
All this puts Greenspan's warning about 'irrational exuberance' in a context of bravery. That took a lot of risk and guts to tell it like it is. Econo-Girl is going to miss old Alan Greenspan.
3.29.2006
3.27.2006
The Six Percent Solution
Bernanke made a little remark that is receiving little attention, although it should. He said that the trade deficit the US has with the rest of the world could be corrected by a six percent drop in the value of the dollar. He wasn't advocating that drop, but assured America that if it did happen, not to worry. Our economy was strong enough to handle it.
In what sense, Econo-Girl asks. Since much of consumer goods are imported, it means that the price of imported goods would rise six percent, right off the bat. And that assumes no escalating in the price rise as retailers fear a continutation of that rise and their prices go up to meet the level of their fear.
And what effect would a sudden rise in prices have on your personal economy? So what is he talking about? He is the Fed Chief. He knows that prices will rise for everyone if the dollar drops in value to that extent. Does he think most people will take that in stride?
In what sense, Econo-Girl asks. Since much of consumer goods are imported, it means that the price of imported goods would rise six percent, right off the bat. And that assumes no escalating in the price rise as retailers fear a continutation of that rise and their prices go up to meet the level of their fear.
And what effect would a sudden rise in prices have on your personal economy? So what is he talking about? He is the Fed Chief. He knows that prices will rise for everyone if the dollar drops in value to that extent. Does he think most people will take that in stride?
3.22.2006
Do You Want to Work Here?
A question that everyone going on an interview asks themselves. In the rats maze of cubicles that Econo-Girl works in, she has observed some indicators to watch out for. First of all, how are the carpets? If they are worn badly, then the people there aren't well taken care of. Secondly, are there any plants not belonging to an individual? Plants indicate to me a degree of compassion. Plants in an individual's cubicle indicate that the person wants a piece of refuge with them at work.
Is Econo-Girl jumping to conclusions? As she types out her beliefs, they seem to be a bit quick to judge.
Recently, Econo-Girl has worked at a place where the boss' boss was a young woman who dressed like Adrianna from the Sopranos. The only people who had Dilbert cartoons on display were upper management. Econo-Girl suspects there is meaning in that somewhere. She just can't figure out what it is. Maybe it sucks to be middle management.
Is Econo-Girl jumping to conclusions? As she types out her beliefs, they seem to be a bit quick to judge.
Recently, Econo-Girl has worked at a place where the boss' boss was a young woman who dressed like Adrianna from the Sopranos. The only people who had Dilbert cartoons on display were upper management. Econo-Girl suspects there is meaning in that somewhere. She just can't figure out what it is. Maybe it sucks to be middle management.
3.17.2006
Casino
Econo-Girl watched one of her favorite movies last night: Casino. Geek that she is, one of the things she likes about it best are the little business lessons about putting the most profitable machine in front, etc. She always wondered why DeNiro didn't have Sharon Stone's old boyfriend killed or something.
Of course, intrepid readers will remember how Econo-Girl hated, HATED Vegas when she went there. Gambling is not her thing, mostly because she hates to lose. Some people think it is fun, she knows, but it actually is rather scary to me. Sitting there, you feel like you are the center of it all. And nothing else exists. And the rounds go so fast. I know that is the point. You don't get to enjoy sitting there without playing.
A statistician one told Econo-Girl that you can expect to get 30% return at a casino, max. And the longer you play, the more likely you are to lose. It's in the numbers. Who would have thought that that extra zero or two would throw things so much? But it does.
Watching the other people in Vegas was depressing. Some of them were so sad. Maybe they felt like us about being there.
Of course, intrepid readers will remember how Econo-Girl hated, HATED Vegas when she went there. Gambling is not her thing, mostly because she hates to lose. Some people think it is fun, she knows, but it actually is rather scary to me. Sitting there, you feel like you are the center of it all. And nothing else exists. And the rounds go so fast. I know that is the point. You don't get to enjoy sitting there without playing.
A statistician one told Econo-Girl that you can expect to get 30% return at a casino, max. And the longer you play, the more likely you are to lose. It's in the numbers. Who would have thought that that extra zero or two would throw things so much? But it does.
Watching the other people in Vegas was depressing. Some of them were so sad. Maybe they felt like us about being there.
3.14.2006
Inheritance Wars
Agatha Christie made her literary career on WASP fights for inheritances. She was really on to something. Nothing brings out the unbridled id like standing in line for the family treasures.
Dearest Readers, recently Econo-Girl has shared with you her grief at the loss of a great man, Fred Tate. So imagine Econo-Girl's feelings when, one hour after his arrival, his son wanted to raid any common accounts Fred Tate held with his wife, the son's stepmother.
The body was barely cold.
Fortunately, all monies were kept completely separate, lucky for Aunt Janice. A few days later, Janice called us, upset, because her stepson wanted to take the car. That, too, was headed off at the pass.
It's not that the son is a bad fellow. He isn't. It's just the weird way people feel that they "deserve." As in "Dad left Mom and me for this woman and spent this money on her." Now he deserves it back. That's all. So he came to collect.
Leisure Lad and I are not blood relations. We feel obligated because we promised Fred on his last night alive that we would always look after Janice. And we will. Janice doesn't want to be alone in the house at night, so Leisure Lad and Econo-Girl have been staying at the house a few nights a week. It's tough, because we're being treated like moochers. Janice's family is in Rhode Island, we're staying with Janice when she wants us to, we're getting home health aides for her, we're doing the shopping for her, getting a better maid, looking for a dog groomer, etc.
The biological family treats us like hangers-on. Who would be there if it wasn't for us? Janice doesn't even think she needs help at home. We have to talk her into it, and even then she changes her mind and sends them away when they arrive.
Janice's sister thinks that, after being barely ambulatory for a few years and not walking at all since October, Janice should just get over it and get to walking again.
Econo-Girl is finding all this emotional stuff to be very taxing. Janice and Fred helped my husband very much throughout his life. We will not forget our obligation to Fred. But, dammit, I want some appreciation.
Dearest Readers, recently Econo-Girl has shared with you her grief at the loss of a great man, Fred Tate. So imagine Econo-Girl's feelings when, one hour after his arrival, his son wanted to raid any common accounts Fred Tate held with his wife, the son's stepmother.
The body was barely cold.
Fortunately, all monies were kept completely separate, lucky for Aunt Janice. A few days later, Janice called us, upset, because her stepson wanted to take the car. That, too, was headed off at the pass.
It's not that the son is a bad fellow. He isn't. It's just the weird way people feel that they "deserve." As in "Dad left Mom and me for this woman and spent this money on her." Now he deserves it back. That's all. So he came to collect.
Leisure Lad and I are not blood relations. We feel obligated because we promised Fred on his last night alive that we would always look after Janice. And we will. Janice doesn't want to be alone in the house at night, so Leisure Lad and Econo-Girl have been staying at the house a few nights a week. It's tough, because we're being treated like moochers. Janice's family is in Rhode Island, we're staying with Janice when she wants us to, we're getting home health aides for her, we're doing the shopping for her, getting a better maid, looking for a dog groomer, etc.
The biological family treats us like hangers-on. Who would be there if it wasn't for us? Janice doesn't even think she needs help at home. We have to talk her into it, and even then she changes her mind and sends them away when they arrive.
Janice's sister thinks that, after being barely ambulatory for a few years and not walking at all since October, Janice should just get over it and get to walking again.
Econo-Girl is finding all this emotional stuff to be very taxing. Janice and Fred helped my husband very much throughout his life. We will not forget our obligation to Fred. But, dammit, I want some appreciation.
3.11.2006
The Intolerance of Intolerance
Here's a good one. If you are caught harrassing, pestering, annoying, bothering any employee, you are subject to termination. Because, by God, they're not going to tolerate any intolerance!
But what if your conversational style is just aggressive? What if someone is ducking your e-mails? What if someone drank your milk in the corporate fridge? You can't pester them about it? That seems awful stringent to Econo-Girl, who herself is not known for quiet stoicism. But what kind of workplace does that engender? You would be afraid for your job if you were too persistent, for fear that you were pestering. You wouldn't want to accuse your co-worker of going through your purse, for fear you were bothering her.
What's an Econo-Girl to do? Keep an updated resume.
But what if your conversational style is just aggressive? What if someone is ducking your e-mails? What if someone drank your milk in the corporate fridge? You can't pester them about it? That seems awful stringent to Econo-Girl, who herself is not known for quiet stoicism. But what kind of workplace does that engender? You would be afraid for your job if you were too persistent, for fear that you were pestering. You wouldn't want to accuse your co-worker of going through your purse, for fear you were bothering her.
What's an Econo-Girl to do? Keep an updated resume.
3.08.2006
India
An article today in the New York Times talks about the long-term pitfalls in investing in India. They say that there isn't the human capital to feed the IT growth. The schools for engineering and technology are great, but the primary schools are dreadful and 40% of the population drops out in grade school.
Let's talk about this a bit. Behind the numbers is the social system in India, where most people can't afford an education. And that is exactly what would have to change. But what are the obstacles? A social system called the caste system. In it, most people are on the bottom and have no way to rise to a higher class level. Most people are in dreadful poverty.
So for this to change, high caste young people would have to go to school with low caste people in grade school. Then, when they are all competing in later grades, high caste people are going to have to accept that their children lost to some low caste kids. In young adulthood, Indians will have to accept Untouchables as co-workers and supervisors.
Econo-Girl has been to India. She doesn't see this as happening. Econo-Girl worked with an emigre from India once. He told the whole team how he paid the maid back home $2.50 a month. A MONTH! We offered to take up an office collection to give her a raise, but he wouldn't accept it, saying that if you gave them more money they just got spoiled.
Econo-Girl came to believe, after her trip to India, that the social mores surrounding economic activity is as important as the activity itself. In the States, we don't look to your family name before deciding on your promotion (for the most part). You have to deliver the goods. We don't defer to rank or age. And it is that flexibility that makes America great, and keeps it that way.
Let's talk about this a bit. Behind the numbers is the social system in India, where most people can't afford an education. And that is exactly what would have to change. But what are the obstacles? A social system called the caste system. In it, most people are on the bottom and have no way to rise to a higher class level. Most people are in dreadful poverty.
So for this to change, high caste young people would have to go to school with low caste people in grade school. Then, when they are all competing in later grades, high caste people are going to have to accept that their children lost to some low caste kids. In young adulthood, Indians will have to accept Untouchables as co-workers and supervisors.
Econo-Girl has been to India. She doesn't see this as happening. Econo-Girl worked with an emigre from India once. He told the whole team how he paid the maid back home $2.50 a month. A MONTH! We offered to take up an office collection to give her a raise, but he wouldn't accept it, saying that if you gave them more money they just got spoiled.
Econo-Girl came to believe, after her trip to India, that the social mores surrounding economic activity is as important as the activity itself. In the States, we don't look to your family name before deciding on your promotion (for the most part). You have to deliver the goods. We don't defer to rank or age. And it is that flexibility that makes America great, and keeps it that way.
3.03.2006
Menu of Corruption
Duke Cunningham took bribes as a California Congressman to hand out "no compete" business to defense contractors. In the interests of efficiency, Duke made out a MENU for corrupt defense contractors to show how much payoff it would take per million dollars of business. Pretty handy, eh? And it seems it's been going on for years. Econo-Girl has heard talk of defense contract corruption that included working Defense employees. No specifics, mind you. But rumors were there. The trick was to hire a retired general who knew how it was done.
So now leniency is being pleaded for former fighter pilot who fleeced the Treasury and betrayed the public trust. Econo-Girl votes "no".
Yes, personal bravery and stamina, quick-thinking and intelligence are admirable qualities in any American. But the man's a thief. And it is hard to accept, but that is not inconsistent with his better qualities. Yes, he has served his country admirably. But he profited from it admirably as well. Duke Cunningham should be given the maximum prison sentence, even if he dies there. His corruption was not merely one bad choice, or even a few of them. It established a systemic corruption founded on Duke Cunningham's military experience. He pissed in his own soup. Then he fed it to the U.S. public. Yum-yum.
So now leniency is being pleaded for former fighter pilot who fleeced the Treasury and betrayed the public trust. Econo-Girl votes "no".
Yes, personal bravery and stamina, quick-thinking and intelligence are admirable qualities in any American. But the man's a thief. And it is hard to accept, but that is not inconsistent with his better qualities. Yes, he has served his country admirably. But he profited from it admirably as well. Duke Cunningham should be given the maximum prison sentence, even if he dies there. His corruption was not merely one bad choice, or even a few of them. It established a systemic corruption founded on Duke Cunningham's military experience. He pissed in his own soup. Then he fed it to the U.S. public. Yum-yum.
3.01.2006
Conventional Wisdom
What can a person trust? Econo-Girl was perusing the business section of the New York Times, where someone was dismissing the effects of a real estate price collapse. After all, he pointed out, only 10% of homeowners owe so much on their homes that a 'value' reduction would cause real problems for them.
Hmmm. 'Only' 10% of homeowners. Do you know how many people that is? A hell of a lot of them. And what would be the effect of their belt-tightening? Fewer goods and services sold in general.
This guy mentions that an increase in home values is really not translatable into real increased wealth unless you sell your home. True. But is that really how people have been approaching it? Haven't people been using their sudden home equity to buy, buy, buy? Yes, yes, yes.
The effects of a downturn in the real estate market will be felt across the economy. The question is, what's next? Employment is picking up, which is good. The deficit is astouding. Is there another bubble we can all get obsessed with? Readers will remember Econo-Girl's prediction that the next asset bubble is gold. She is staying with her prediction.
Hmmm. 'Only' 10% of homeowners. Do you know how many people that is? A hell of a lot of them. And what would be the effect of their belt-tightening? Fewer goods and services sold in general.
This guy mentions that an increase in home values is really not translatable into real increased wealth unless you sell your home. True. But is that really how people have been approaching it? Haven't people been using their sudden home equity to buy, buy, buy? Yes, yes, yes.
The effects of a downturn in the real estate market will be felt across the economy. The question is, what's next? Employment is picking up, which is good. The deficit is astouding. Is there another bubble we can all get obsessed with? Readers will remember Econo-Girl's prediction that the next asset bubble is gold. She is staying with her prediction.
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