Thursday, May 24, 2018

Difference between investment and gambling

I think there is one.  Investment means taking good real money and lending it to business enterprises to build factories,power stations, and pipelines, purchase machinery, aircraft, motor vehicles, and ships, to buy inventory,  stuff that grows the business.  Gambling is fun, but the money doesn't go to finance business, it goes back and forth between players.  To keep the economy growing we need to encourage investment and discourage gambling with laws, regulation, and taxes.  
    The stock market makes investment in stocks attractive, mostly because investors can sell their stock for cash, anytime.  And quickly, call your broker, and the sale will go thru that day or the next, and the cash will be in your checking account in another day or so.  That's liquidity, and it vastly increases the desirability of stocks as an investment.  And companies can issue and sell stock, raising cash for merely printing a stock certificate.  If you are starting a company, the ability to issue company stock to raise money is a real boon.
   And then we have those things that are mostly gambling.  The morning NPR news regularly reports "Dow futures are up (or down)".  I don't really know just how Dow futures work, but I seriously doubt that any of the money that changes hands gets to businesses for investment.  I think  the money just goes back and forth between financial players.  Pure gambling.   Same goes for "derivatives"  another poorly understood (at least I don't really understand them)  financial deal which just passes money around among players. 
   We always need more investment and less gambling. 

Wednesday, May 23, 2018

Oxford History of the American People by Samuel Elliot Morison

This is American history as it ought to be written.  Morison starts with pre Columbian America and takes the story right up to the present day (in Morison's case 1965).   Morison is a fine writer, his text reads as well as anything by Bruce Catton  or Shelby Foote.  He covers everyone of any interest, and every political thought that occurred in America.  He leaves nothing out. And he make it all interesting.  The book is massive, 1150 pages.
   Morison is an fascinating guy.  He was a Harvard professor.  He held a commission in the Navy reserve.  When WWII broke out, Morison became the Navy's historian.  He went to sea, pretty much for the duration.  He was at the Torch landings in North Africa, he was at Midway.  After the war he single handedly wrote the Navy's history of World War II, in  fifteen volumes, The History of U.S. Naval Operations in World War II.   And he collaborated with Henry Steele Commager to write Growth of the American Republic, (usually known as Morison and Commager) which was the standard college US history text for decades.  They don't make Harvard professors like that anymore. 
   It's a fine read by one of the best American historians ever. 

Tuesday, May 22, 2018

Give all the teachers a 40% raise

That's what an op ed in Tuesday's Wall St Journal calls for.  The writer seems to feel that teachers ought to get paid more, to bring their salaries in line with say civil engineers.  OK, nice thought and all.  But.
   I'm still a believer in capitalist free market theory.  You pay enough to attract the people you need, and no more.  The modest wages paid to teachers are a signal to young people that we have a goodly supply of teachers and you could do better and make more money in other lines of work.  That's what the market is supposed to do, issue price signals to workers and suppliers, when there is a shortage of something, be it Hershey bars or school teachers, the price goes up, more people take up teaching, or candy companies make more candy bars.  It's a system that has served us well, allocated labor and capital intelligently, and given us fantastic prosperity.  The Soviets tried to operate without the market and they only lasted 70 years. 
   The same op ed did note that teachers of math and science, who are always in short supply, get paid more than the average teacher.  Hint to aspiring teachers, do a math or science major in college rather than the ed major.
   I guess my other problem with the mare 'em more idea is that we have poured more and more money into public schools.  The vast funding increase has not improved our children's education, at least by objective measures like test scores.  They have remained flat over the decades while school funding has doubled. 

Monday, May 21, 2018

Why was Prince Harry wearing a black uniform?

I thought Harry had served in the British Army, you know, the Redcoats.  He was wearing a black uniform, with his pilot's wings and some ribbons, at his wedding yesterday.  

Hair Products popular with Black Women may contain harmful chemicals

Thus saith UnScientific American on their website.  They go on at some length, listing a whole bunch of organic chemicals that I am unfamiliar with.  I never took organic chem.  On the other hand, they failed to mention, anywhere, ever, just HOW MUCH of these allegedly harmful chemicals were present in the hair products.  Modern chemical analysis is so sensitive that it can detect small amounts of anything, just about anywhere.  The article failed to let us readers know if these harmful chemicals  were present in just tiny trace amounts, or in amounts large enough to matter.  

Sunday, May 20, 2018

The Economics Profession ain't diverse enough

Thus saith The Economist.  They been running the occasional think piece about economics.  This week they ran the last of the series.  And all they had to talk about was the lack of diversity, women and blacks, in economics faculties.  It's a worthy thought, I think.
   But I'm more interested in whether economics as a "science" gets it right or not.  Actually I consider economics as much as an art as a science, sorta like history.  In fact economics could call itself economic history.  Since you cannot run experiments in economics, at least not on the scale of a national economy, the people object, the best economists can do is gather observations,  like they do in geology and astronomy.  So although economists use a lot of mathematics ('cause a page of equations looks so cool in a paper) it isn't really a full science like physics and chemistry.  It's scientific, sometimes.
   But the real question is do the economists really know what they are doing? 

Saturday, May 19, 2018

Eradicating Polio

  A piece on NHPR the other morning talked about eradicating polio in Pakistan.  The Pakistani's mounted a massive vaccination campaign, thousands of workers, going every where, and vaccinating every child they found.  The case rate dropped from several hundred polio cases a year down to this year, just one case so far. 
   Trouble is, the vaccination program is encountering Pakistani parents who refuse to allow their children to be vaccinated. The one polio case this year was a child whose parents refused vaccination, several times.  Vaccination program workers are reporting resistance and threats of violence. 
   I gotta wonder about a culture so poisonous that it prefers to see their young children die of a horrible disease rather than give them a life saving vaccine.  I remember back when the polio vaccine was first invented.  They set up tables outside in the Saxonville School yard, and in one day, they vaccinated every single kid in Saxonville including me.  Parents supported it 100%.