Hound Dog Taylor

Hound Dog Taylor was one of the legends of slide guitar.

This isn't the best video of all time but you do get to see him strut his stuff.

Around The traps 27/9/13

It is time for Around the Traps.

updates on Sunday.


Aussie,Aussie,Aussie,Oy,Oy,Oy

• Peter Martin on the-truth-about-women-why-abbotts-cabinet-won't-last.get-set-be-careful-house-prices-are-taking-off
• Ross Gittins on no-need-to-exaggerate-labors-failings, is-reversing-labor-all-we-need-for-our-future
• Mumble on spinning_wheels, labor_preference_advantage_peaks
• Kevin Bonham on too-much-information-mixed-performance
• Ken Parish on stop-the-boats-westies
• Nicholas Gruen on memo-to-annabel-it-aint-gonna-happen
• Andrew Elder on shipping-news

Canada (where Messrs Giles and Rowe have annexed the USA)

• MarkThoma gives us Kevin Drum on  how-austerity-wrecked-the-american-economy
• Brad De Long on peter-orszag-economy-cant-be-all-thats-slowing-health-costs-noted
• Skeptikoi on the-commitment-phobic-fed
• Mark Thoma gives us Tim Duy fed-watch-resetting-expectations, fed-watch-a-synopsis-of-fedspeak
• Livio Di Matteo on fiscal-clout-and-federation-redesign

Europe

• Kruggers on the-pain-in-spain-is-not-hard-to-explain-wonkish
• Stephen Gordon on trends
• Menzie Chinn on ironies_abound
• Philip Lane on new-report-on-the-financial-crisis, the-sovereign-debt-crisis-and-the-euro-area, imf-toward-a-fiscal-union-for-the-euro-area
• Simon Wren-Lewis on labours-obr-proposal, sound-bite-economics, what-shall-we-tell-our-students
• Richard Dorsett on helping-long-term-unemployed
• John McHale on the-government's-balance-sheet-after-the-crisis-a-comprehensive-perspective
• Dianne Coyle on low-investment-another-moan
• Brad De Long on martin-wolf-osborne-has-now-been-proved-wrong-on-austerity-noted

Asia
nutting again!

Wonk

• Gavin Kennedy on mathematica-truths-do-not-make-untrue  Thanks Mark
• Philip Lane on estimating-structural-unemployment
• Lord Keynes on an-observation-on-deduction
• Nick Rowe on teaching-comparative-advantage-barter-vs-money, two-neo-wicksellian-indeterminacies
• David Glasner on hawtreys-good-and-bad-trade-part-ii
• Pro-Growth liberal on who-ends-up-losing-their-job-under-a-higher-minimum-wage
• Edward Lambert on inflation-is-a-game-of-cat-and-mouse

General

• Simon Wren-Lewis on the-scandal-of-austerity-deception, the-king-who-disliked-letter-g, austerity-growth-and-being-economical-with-the-truth
• Mark Thoma on whats-it-all-about-then-the-real-reason-for-the-fight-over-the-debt-limit
• Brad De Long on paul-krugman-whats-it-all-about-then-noted
• Antonio Fatas on ignorance-and-bias-in-economic-models  Thanks Mark
• Chris Dillow on neoliberalisms-unintended-consequences
• Paul Frtijzers on race-and-iq-how-can-we-dismiss-the-correlations
• John Robertson on the-dynamics-of-economic-dynamism

Brian Banisch (climate)

• arctic-sea-ice-extent-minimum-for-2013
• climate-clippings
• crisis-or-catastrophe-what-will-the-ippc-say
• Brad De Long on felipe-calder%C3%B3n-and-nicholas-stern-the-new-climate-economics-noted, but-we-must-do-the-wrong-thing-understanding-the-economic-arguments-against-dealing-with-global-warming, richard-muller-and-the-new-york-times-on-global-warming-department-of-whiskey-tango-foxtrot-bang-query-bang-query-weblogging, /likelihood-that-human-greenhouse-gas-emissions-responsible-for-more-than-half-of-warming-updated-from-very-to-extremely, joe-barsugli-on-enso-and-climate-change-noted
• Harry Clarke on summary-for-policy-makers-from-ipcc
• Sinclair Davidson on being still too gutless to say there has been a structural break in rising world temperatures
• Tim Harford on an-energy-price-cap-that-does-not-quite-fit

Andrew Gelman (Statistics)

• more-on-bayesian-methods-and-multilevel-modeling
• my-talk-tues-24-sept-at-12h30-at-universite-de-technologie-de-compiegne
• citations-for-using-stan
• instead-of-the-intended-message-that-being-poor-is-hard-the-takeaway-is-that-rich-people-arent-very-good-with-money
• harmonic-convergence
• classical-probability-does-not-apply-to-quantum-systems-causal-inference-edition
• difficulties-in-making-inferences-about-scientific-truth-from-distributions-of-published-p-values
• difficulties-of-using-statistical-significance-or-lack-thereof-to-sift-through-and-compare-research-hypotheses
• Good Stats Bad Stats on the probability of making the Baseball playoffs, parity in the NFL
• Kaiser Fung on know-your-data-14-they-may-know-things-about-you

Dave Giles (Econometrics)

• new-working-paper
• blogging-about-your-research
• more-interesting-papers-to-read

Dianne Coyle and Frances Woolley (Quirky with a dash of book reviews)

• Frances on academias-not-so-dirty-secret
• Dianne on economic-forecasts-fortune-telling-and-sunspots, how-to-be-a-successful-maverick, economic-lessons-from-asia, uncomfortable-lessons-of-history
• Tim Harford on ten e-mail commandments
• Guan Yuang on this-blog-post-cost-$0

Voxwonk

• do-european-fines-deter-price-fixing
• persuasive-communication-men-and-women-react-differently
• offshoring-and-innovation-emerging-economies
• next-greek-package-dangers-ez
• forecasting-oil-prices-using-product-spreads
• should-brazil-s-central-bank-be-selling-foreign-reserves
• capital-back
• dilemma-financial-trilemma
• body-fat-and-food-prices
• partial-horizontal-acquisitions-and-antitrust-policy

Castle: episode1 series 6

Well it could have been worse.

I wasn't expecting any of the important questions to be answered and they were not.

The episode was passable but that is all. Far too much Beckett and far too little Castle.

It seemed like another series and Dr Cuddy is still not likable at all.

I will find it interesting whether the emotional and psychological reasons why Beckett is such a good homicide detective are shown as negatives in this job. No-one at the interview recognised this at all. Neither Beckett nor the Deputy Director.
I am going out on a limb here but I am betting this will be where the seeds of watershed come in for Beckett.

I am still staggered some-one can say they love somebody and then tell them they have accepted a job which will be bad for the relationship. ( highly euphemistic!). And they accept a job without any input from the person they supposedly love! I am glad my wife doesn't love like that.

My problem now is I have to wait another few episodes until the 'old' Castle comes back with its 'magic'.

I suspect Marlowe may not be writing another series.

It wasn't an engrossing start. My boys will now wait until the episodes are on TV as Castle lacks that vital something and I guess I will too.

Just in case. the Lovely Lady from Writing on the Castle Walls on Watershed    (essential reading)

Update

My boys have just informed me they will not be watching Castle until it comes back to the 12th !

Robert Cray & Albert Collins

Just wow!

Around the Traps 20/9/13

here we go again. It is time for Around the Traps.

Cricket tomorrow all day (coaching and then umpiring) so updates on Sunday.
I have put in bold related articles and also Kaiser Fung interviews Andrew Gelman!
Dave Giles has 4 articles and it is only Friday!!! onya Dave.



Aussie,Aussie,Aussie,Oy,Oy,Oy

• Mumble on only_a_landslide, eighteen_months_and_then_what,personal_votes_2013
• The Piping Shrike  on unity
• Matt Cowgill on the-derp-surplus
• John Quiggin on the-global-party-of-stupid, saving-the-salary-packaging-industry
• Harry Carke on daft-coalition-economics-3-paid-parental-leave, daft-policies-4-sacking-skilled-civil-servants
• Andrew Elder on the-student-who-never-learned, whos-who-and-whats-what
• Mark Banisch on the-cathy-mcgowan-indi-model-ripe-for-harvest
• M0nty on the-statification-of-australian-federal, abbott-and-hockeys-hyper-bowls-of-sh-t

Canada ( oh and the USA!)

• Mark Thoma gives us Tim Duy and fed-watch-summers-out-yellen-in, fed-watch-froth-alert,fed-watch-no-taper-yet, fed-watch-further-post-mortem
• Ricardian Ambivalence on taper-off-taylor-broken
• Pro-growth liberal on morning-in-america-laugher-curve, john-taylors-prediction-of-fiscal-catastrophe-assumed-his-candidate- won-in-2012
• Calculated Risk on key-measures-show-low-inflation-in-August
• Edward Lambert on inflation-low-and-steady-as-she-goes, fed-please-taper-i-beg-you
• Whitney Macuso on the-abcs-of-lfpr
• Brad De Long on amitabh-chandra-jonathan-holmes-and-jonathan-skinner-is-this-time-different-the-slowdown-in-healthcare-spending-noted

UK ( and the rest of Europe)

• Chris Dillow on recovery-for-whom, accepting-inequality
• Brad De Long gives us ambrose-evans-pritchard-my-grovelling-apology-to-herr-schauble, solitudinem-faciunt-et-reformationem-appellant
• Kevin O'Rourke on dani-rodrik-on-the-eurozone-crisis, a-proposal-for-the-dismantling-of-the-eurozone
• Sean O'Riain on suicides-after-the-crisis
• Brendan Walsh on suicide-and-the-recession-again
• Kruggers on latvian-adventures
• Philip Lane on boom-bust-recovery-forensics-of-the-latvia-crisis

China (and Asia)
nuttin
Wonk

• John Aziz on are-humans-rational-utility-maximisers
• Kruggers on in-front-of-their-noses (link to Antonio Fatas)
• Edward Lambert on estimating-profit-rates-of-capital , would-keynes-say-krugman-is-assuming-says-law-just-saying
• Nick Rowe on interest-rates-and-aggregate-demand
• Edward Lambert on  nick-rowe-explores-interest-rates-aggregate-demand-what-about-profit-rates-optimism-effective-demand
• Carola Binder on academic-scribblers-and-history-of-inflation-protected-securities 
• Livio Di Matteo on revolution-income-and-decline-the-american-revolution-and-the-first-american-great-depression
• Lord Keynes on modern-epistemology-in-analytic, what-is-epistemological-status-of-law-of-demand
• Miles Corak on mr-keynes-and-the-austrians-a-battle-over-a-suggested-interpretation-of-unemployment thanks Mark
• Jazzbumpa on rational-nonexuberence-part-2
• Menzie Chinn and gdp_growth_and_CAB balance
• Brad De Long on /noted-to-aid-your-lunchtime-procrastination-for-september-19-2013
• Dan Crawford on deadweight-loss-re-defined

General

• James Hamilton on the_peak_in_world_oil_production_is_yet_to_come
• Menzie Chinn on lehman_plus_five
• Ricardian Ambivalence on learning-from-lehman
• Brad De Long on the-lehman-disaster-was-foreseeable
• Nick Rowe on bertrand-cournot-and-the-simple-money-game, teaching-notes-on-banks 
• Chris Dillow on inflation-and-real-incomes
• Mark Thoma gives us Antonio Fatas on waste-in-the-private-sector

Brian Banisch (Climate)

• John Quiggin on cant-quote-cant-link, /we-got-it-wrong-says-oz-but-theyre-still-wrong, the-daily-mail-comprehensively-anti-science
• Rex Ringshott  on climate-leak-bombshell-or-numeric-dyslexia-we-report-you-decide
• Harry Clarke on daft-coalition-economics-2-carbon-pricing, 
• Brian on abbotts-direct-action-on-climate
• Environmental economist on ummmthats-kinda-the-point  thanks Mark
• Steve from Brisbane on rising-waters

Andrew Gelman (Master of the P Values)

• the-it-gets-me-so-angry-i-cant-deal-with-it-threshold
• swiss-jonah-lehrer-update
• christian-robert-on-the-jeffreys-lindley-paradox-more-generally-its-good-news-when-philosophical-arguments-can-be-transformed-into-technical-modeling-issues
• understanding-posterior-p-values
• is-coffee-a-killer-i-dont-think-the-effect-is-as-high-as-was-estimated-from-the-highest-number-that-came-out-of-a-noisy-study
• what-makes-a-statistician-look-like-a-hero
• six-red-flags-for-suspect-work
• Good Stats Bad Stats on understanding reported changes in median income 

Dave Giles ( Econometrics, very tricky)

• replication-and-reproducibility
• another-regression-trick
• yesterday-william-m-briggs
• more-on-history-of-phillips-curve
• on-zero-correlation-and-statistical-independence
• roger-farmer-on-natural-rate-hypothesis-and-the-Phillips-curve

Dianne Coyle and Frances Woolley (quirky with a dash of book reviews)

• Tim Harford on the-enduring-appeal-of-the-plastic-banknote, a-primer-on-free-primary-school-meals
• Dianne on the-enlightened-economist-book-prize-shortlist, banker-bashing, beyond-gdp, a-room-full-of-naked-bankers, life-and-art
• Josiah Neeley on the-science-of-hippie-punching 
• Chris Dillow on the-preferences-problem

Vox wonk

• time-to-change-uk-monetary-policy
• eastern-migrants-help-balance-budgets
• article/migration-and-wage-effects-taxing-top-earners
• coase-theorem-and-economics-coase
• did-us-beer-mergers-cause-price-increase
• banking-recovery-and-resolution-directive
• competitive-effects-pc-software-bundling
• exit-path-implications-collateral-chains
• german-labour-reforms-unpopular-success
• renting-capital-un-constrain-credit

Goodbye Sophie Mirabella

Sophia Mirabella lost her seat of Indi at the election.

I found this result highly satisfying.

She was a loud voice during the republican debate saying you couldn't trust politicians. Somehow you could trust the Prime minister to nominate the Governor General however.

She then decided to become a politician!

During the election she told people in her electorate there were only two issues. Repealing the carbon tax and stopping the boat people.

She was badly wrong!

bye bye Sophie!

Mrk Banisch has this piece on the campaign in Indi

Castle: Questions and some advice for Andrew Marlowe

We previously explored problems of the last episode of Castle series 5 here.

What I want to do now is examine what are the main questions that should be answered in the 1st episode of series 6 to be aired on September 23 ( USA time).

As this piece will be quite critical of Andrew Marlowe and the final arc of series 5 it is only fair I put up an alternate view. This of course is the Lovely Lady from Writing on the castle Walls. ( you will have to explore the site but it is worth it.)

The major questions are and this in no order of importance.

Why the difference in attitude in jobs between this situation and what happened with Will Sorensen? He was transferred to Boston but she refused to follow him. He was earning more money than her. Here Castle earns a lot more money than her.

Why is Beckett being portrayed as a bimbo?  She accepts Stack's word without question but he was very unimpressive.She does NO research into the job. She does not use her network and since she lied to Castle about it cannot use his. She doesn't even understand how important Castle is to her. Indeed no-one does. Neither Stack, Gates, Beckett or the interviewer understand this important dynamic. If she goes to DC and then realises how bad it is for her relationship with Castle then that is reinforcing her as a bimbo.
Until the final arc Beckett was never a bimbo.

Why did Gates give Beckett her highest recommendation? After All she had suspended her from duty and should have known Beckett broke several rules whilst 'guarding' Vaughn.

When, why and how did Beckett change from being a homicide detective for idealistic reasons into an ambitious career driven woman?  We have no idea here. Does she realise she won't be empathising with victims in DC. There is more to the work than gathering evidence?

Why was the interviewer for the job so incompetent?  He had no idea of her relationship with Castle, He asserts her background, qualifications and experience is very good for the job. BUT in Australia they would be looking at a well rounded detective not one who has only done homicide. Her educational qualifications would have atrophied as a detective since she hasn't used any university training much in her job. Homicide detectives utilise evidence a lot. This is vastly different from intelligence which we can assume is part of this job.

Why did she lie to Castle in each of the last three episodes? Is this becoming a habit or simply something she does when under pressure.

Why would she say yes to Castle's proposal? She has to all extent and purposes acceptd the DC job when it is clearly a relationship destroyer as she told her Dad.

Why is a proposal being proposed ( pun intended)?  These two cannot talk to each other, are not open, keep secrets and as we see in the DC job cannot share ( well Beckett cannot).

Neither Espo nor Ryan had been told about this job. In real life they would be ropable Beckett has taken this job without telling them. They are a family at the 12th. They share things and Beckett obviously hasn't. There is also the problem of rivalry between organisations and here it is the NYPD and the agency.

We really should see the Caskett relationship develop and grow not deteriorate as it did over Series 5. Two people who are in love and love each other ( they are entirely two different things) cannot have so much angst in their relationship. Get rid of it!

The major reasons why Castle has been the GREATEST series of all time is because of the Caskett relationship and the zany cases they investigate. The banter between the two shouldn't reduce when they become a couple it should increase!
The comradery of the team makes it easy for them to work at their best.

This is what we need to see.We do not want to see a soap opera!

update.
I am reasonably happy with Marlowe up to the final arc of Series 5. Castle  then goes somewhat pear shaped. We know Caskett will happen BUT it needs to be sensible , logical and consistent with previous episodes.

Catallaxy:There is no hope

Quite some time ago I wrote about how Catallaxy needed to lift its game.

However following on Sinclair Davidson's presentation which we examined  (and to be very charitable it was incompetent) we must now say Catallaxy is beyond hope.

Let us just look at a few contributors:

• Sinclair Davidson, well we have already dealt with him
• Henry Ergas, Our 'Enry implies since the NZ Government has projected it budget to be balanced then Australia' should be as well. Oops he forgot to say the budget is predicated on rather optimistic rising terms of trade assumptions. This translates into their Nominal GDP being double to what ours is. Funny about that!
• Judith Sloan said on National Television ( Q&A to be precise) that the NBN was off the balance sheet. Check that out!  Any retraction or saying sorry I got that badly wrong. No! When commenter SDFC at Catallaxy told all and sundry it was on the balance sheet he was abused for the thought. What bright people they have there.
• And of course how can we forget Katesy. Go and look what he said about how Romney would win the US election. How Nate Silver, Sam Wang, Simon Jackman et al had it all wrong. Did he admit how badly wrong he had been? No! (We will ignore his preposterous claims European nations were following Keynesian policies.)

Put simply no-one at Catallaxy is capable of telling the truth. It is all about ideology. They are simply mimicking the communists from the 1950s!

How utterly ironic!

It is violently anti-intellectual.

Traffic

Traffic were one of the alltime great groups.

This is to my mind the best song they ever did.

The low spark of high heeled boys.

And this is simply magic live.

Around the Traps 13/9/13

It is time for Around the Traps again.

I am coaching cricket on Saturday Morning and then Umpiring in the Afternoon so no updating until Sunday.


Aussie,Aussie,Aussie,Oy,Oy,Oy

• Grog's Gamut on election-2013-newspapers
• Greg Jericho on how hockey catallaxied himself!  Thanks Steve from Brisbane
• Mumble on and_theyre_off, two_stage_tony, some_western_sydney_facts, and_what_now
• The Piping Shrike on relief
• Peter Martin finds coalition voters are idiots
• Mr Denmore on under-the-dome
• Andrew Eder on the-limits-of-insider-journalism,  when-rudd-disappears, as-good-as-it-gets

Canada ( which Dave Giles and Nick Rowe believe may include the USA!)

• Calculated Risk on cbo-monthly-budget-review-for-august,/update-when-will-payroll-employment-exceed-pre-recession-peak, conforming-loan-limits-and-house-prices, repeating-myself-on-debt-ceiling
• Menzie Chinn on observations_on_the_labour_market_and_all_that
• Ricardian Ambivalence on can-you-taper-with-that
• Spencer England on obama-care-and-part-time-employment-part-2
• Mark Thoma on what-defunding-means
• Owen Zidar gives us transfer-payments-and-the-macroeconomy-the-effects-of-social-security-benefit-changes Thanks Brad

Europe

• Philip Lane on austerity-should-not-be-confused-with-pragmatism , ft-osborne-wins-the-battle-on-austerity
• Kevin O'Rourke on grant-me-microeconomic-efficiency-but-not-yet
• Kruggers on uncertain-at-the-oecd, but-wheres-my-phoenix
• Jonathon Portes on niesrs-forecast-matthew-parris-astonishingly-inaccurate-critique

Asia

• Kruggers on make-japan-chaste-and-continent-but-not-yet
• Menzie Chinn on cny_on_the_rise
• Jazzbumpa on rational-nonexuberence-part-1

Wonk

• Steve Roth on more-on-the-labor-force-surge-and-70s-stagflation
• Edward Lambert on will-there-be-inflation-in-the-next-recession
• Nick Rowe on old-and-new-keynesians-and-self-equilibration and Kruggers license-to-stagnate
• Kruggers on oh-yes-they-can, wynne-godley-and-the-hydraulics, when-good-things-happen-to-bad-ideas-2
• Mark Thoma gives us the Dallas Fed and assessing-the-costs-and-consequences-of-the-200709-financial-crisis-and-its-aftermath
• Dan Crawford on links-to-debate-on-full-employmentinflation EXCELLENT
• Lord Keynes on hoppes-caricature-of-empiricism
• The eminently readable David Glasner on uneasy-money-marks-the-centenary-of-hawtreys-good-and-bad-trade
• Nick Rowe on thoughts-on-teaching-the-time-value-of-money, moe-vs-moa
• Brad De Long and noted-to-aid-your-procrastination-for-september-14-2013 Excellent
• Robert Waldeman on Permanent Income Hypothesis

General

• Chris Dillow on social-democrats-structural-failure
• Mark Thoma on remembering-ronald-coases-contributions
• Yichuan Wang on no-economics-is-good-for-lots-of-things
• Menzies Chinn on risk_appetite_etc It is a conference and there are plenty of papers!

Brian Banisch ( Climate)

• Scientific American on warming-climate-begins-to-taint-europes-blood thanks Mark Thoma
• Brad De Long on jonathan-vankin-michael-e-mann-top-climate-scientist-can-proceed-with-libel-suit-against-right-wing-blogs-judge-rules
• Owen Zidar on weather-and-violence

Andrew Gelman (who is statistically significant!)

• false-memories-and-statistical-analysis
• the-ethics-of-lying-cheating-and-stealing-with-data-a-case-study
• informative-g-priors-for-logistic-regression
• recently-in-the-sister-blog-
• do-you-ever-have-that-i-just-fit-a-model-feeling
• you-heard-it-here-first-intense-exercise-can-suppress-diet
• Good Stats Bad Stats on unintended pregnancies , Recession has further polarised familiessports-journalists-reported-lies-and-then-lie-some-more-just-like-dopers
• Kaiser Fong on grant-me-microeconomic-efficiency-but-not-yet 
• Kaiser interviews Andrew!
• Normal Deviate on consistency-sparsistency-and-presistency Thanks Mark

David Giles  ( Everyone knows who Dave is!!)

• can-your-results-be-replicated

Dianne Coyle and Frances Woolley ( Quirky + Book Reviews)

• Tim Harford on blatant self-promotion
• Dianne on not-average-at-all, economists-doctors-quacks,shipping-news, manufacturing-revival, neglected-mental-furniture
• Chris Dillow on the-management-question, advise-whom
• the Wine economist on extreme-wine-oregon-edition  Thanks Mark Thoma
• Liveo Di Matteo on the-historical-constants-of-affluence
• Josiah Neeley on in-future-everyone-will-be-fired-after-15-minutes

Vowonk  Voxwonk

• credit-rating-agencies-and-eurozone-crisis-what-value-sovereign-ratings
• deregulating-firm-entry-good-workers-which-workers
• is-riksbank-neglecting-price-stability-objective-counteracting-full-employment-and-increasing-household-debt
• economic-ideas-ronald-coase
• when-harry-meets-sally-buyer-margins-firms-exports
• citations-caution-context-common-sense
• japan-s-consumption-tax-diversion
• future-japan-s-long-term-care-insurance-program
• reduce-policy-uncertainty-solidify-ez-recovery
• export-market-exit-during-crisis-evidence-uk
• forward-guidance-uk
• language-barriers-impact-non-native-english-speakers-classroom
• mother-all-sudden-stops
• trade-and-innovation-services

Labour Market Deregulation and all that

over at Vox there are two papers really worth reading. They are not all that long.

The First examines Portugal and what happens with a bit of labour marker deregulation. 
It is fascinating. It appears the result is that as one might expect there is increased income and employment but it goes mainly to the better educated workers.

the Second examines raising the minimum wage
Again we see results we might expect. Raising minimum wages reduces net job growth over time. the effect is not immediate.

So if the best policy to boost employment and reduce unemployment would be to deregulate the labour market and reduce minimum wages.

Australia has had a reasonably deregulated labour market since 1993.however we have some of the highest minimum wages in the OECD.
A reasonable policy response by the New Government would be to adopt a previous National Party  government labour market policy of 96 pages which Peter Reith wanted to do in 1996 but was over-ruled by John Howard. John Howard wanted more regulation of the labour market hence work choices.

The best way to reduce minimum wages would be not to raise them at all in future and protect the lower wage workers with a form of family tax credits.

This is expensive for the Government but extremely healthy for the economy and people. NAIRU falls a lot.

Just before we leave how do you spot a regulated labour market?
There are three signs to look for

1) Increased industrial disputation
2) Wages rising higher than you would expect given the economy
3) Higher than normal unemployment given the state of the economy

Guess what none of any of the three signals exists in Australia. Indeed if anything quite the opposite!

Postscript
It is important  microeconomic reforms are not undertaken when the economy is in a recession or worse as they can worsen the economy as shown here.( thanks to Kevin O'Rourke). It is like imposing Austerity when the economy is slowing. You only makes things worse.(Readers will remember the OECD put out a paper saying similar things a while ago.)

Luckily the Australian economy is not there and the micro-economic reform is only at the margin.

The election aftermath

Well the election has come and gone.

It went pretty much as I thought . Skeptikoi shows a variation on a theme.

With nominal GDP much lower than trend most people thought the economy was either in a recession or a slowdown. Hence the large win. A I explained above it is similar but a bit different to 1996.On both occasions the Coalition really did/does not understand why they have won.
This has implications for the next election.

Whilst that was the major reason for the loss another reason was the strategy adopted by the ALP. After being Prime Ministerial in his first couple of weeks once the campaign started he looked and sounded like an Opposition leader. We heard little about the Government's reasonable record or the ALP's policies.
Quite frankly it looked liked Gillard was still PM or her team was. The ALP need to clear away all the deadwood that were part of strategy. They have no idea.

Why did we not hear about this for instance?  Why no comparison about inflation rates of the previous Government and this one, A comparison of interest rates would have been interesting  as well.
This of course would have meant explaining to people the myth of  cost of living pressures!

If you leave the economic area and let the Opposition dictate the story you cannot come in at the last minute and change the storyline. This means the opposition again gets away with murder on their costings and you cannot point out despite their hysterical claims over time the two economic policies are pretty much the same.

(By the way can some-one point out to Poor old Rafe the NBN is in the debt figures. This group of delusionists were claiming it wasn't even in the balance sheet when it clearly always has been. Given there has been no correction at that blog they must still believe that rubbish. This is what happens when people do not even read budget papers!)

I do not expect any major policy change. Tony Abbot has always been a big government conservative as I stated here.So I pretty much agree with Ross Gittins.The Piping Shrike makes a lot of of sense as well.

I do expect them to play the 'oh look the cupboard is bare approach' however given  MYEFO and PEFO this won't wash. In fact it might be an embarrassing repeat of what Barry O'Farrell did in NSW. however it won't do much political damage to them. It is too early. This may intercede however.
And if they do start to make noises about the structural budget deficit then they will/should end up with egg all over their place.

I have low expectations for the Government a so I doubt if I will be disappointed in them.

Two sidelights to the election
1) I am not going to vote for a male bimbo again so next election I will be voting against John Alexander.

2) Kevin Hogan won Page and I know him. His wife Karen is one of the loveliest people you would ever want to know. I went to their wedding in Clunes and it was nice.
I do hope he isn't into conspiracies anymore. He loved to assert the Clintons were drug running murderers!
If so he would do well in an economic portfolio given his academic background and work experience.

Noiseworks

Noiseworks were an OZ band and this is the best song they ever did.

River of Tears

Around the Traps 6/9/13

It is time for Around the Traps again.

I have left out all polling in the last week of the Aussie election. It is tomorrow so we will find out son enough.
John Quiggin has an interesting piece on Market monetarism  modern monetary theory with plenty of great comments.

all articles relating to the late Ronald Coase is in the general section.

Lots of great week-end reading. no football or cricket and am batching all weekend so will update each day.




Aussie,Aussie,Aussie,Oy,Oy,Oy

• John Quiggin on launch-delayed, hidden-in-plain-sight-commission-cuts-and-non-core-promises thanks Steve from Brisbane
• Ross Gittins on why-taxes-would-rise-under-abbott, little-progress-in-economys-transition
• Preston Towers on symbolismwillitmatter
• The Piping Shrike on an-incomplete-revolution-an-update
• Brian Banisch on households-better-off-since-gfc-
• Ricardian Ambivalence on scope-less-rba  good to have you back RA!
• and he here is not liking Senate voting practices unrepresentative-swill 
• Skeptikoi on overlearning-from-history-and-rbas-nominal-recession. I have been remiss. here are a couple of beauties but late from him. australias-productivity-renaissancem rba-speak-animal-spirits-and-the-new-capital-discipline
• Andrew Elder on for-crying-out-loud

Canada V United States

• Calculated Risk on update-charts-to-track-timing-for-qe3, gdp-drag-from-state-and-local-governments, public-and-private-sector-payroll-jobs
• Mark Thoma gives us Neil Irwin on government-jobs-are-still-the-probleml
• Kenneth Thomas on republicans-market-oriented-health-care-reforms-wont-work-part-2
• Edward Lambert on looking-at-the-consumption-rate-of-capital-income, the-limit-of-labors-consumption-rate, has-the-fed-rate-done-a-good-job-to-balance-inflation-over-the-years
• Mark thoma gives us Tim Duy on fed-watch-the-countdown-to-september-18, fed-watch-williams-on-board-with-tapering-kocherlakota-not-so-much, fed-watch-employment-reports-muddies-the-policy-outlook
• Brad De Long gives us joe-gagnon-misconceptions-about-feds-bond-buying
• Edward Lambert on was-cause-of-1960-recession-psychological , the-fed-driving-too-fast-down-an-unknown-road
• Mark Thoma on is-consumer-confidence-is-a-useful-indicator-of-the-labor-market
• Jared Bernstein on how-did-fiscal-policy-get-turned-upside-down, about-that-lower-unemployment-rate-and-public-sector-jobs
• Menzie Chinn on a_tale_of_two_fiscal_policies_continued

Asia
nuttin

Europe

• Bill Mitchell on The Stupidity of German ideology will come back to haunt them
• Simon Wren-Lewis on france-and-commission
• Antonio Fatas on the-euro-counterfactual

Wonk

• Brad De Long gives us michael-woodford-macroeconomic-analysis-without-the-rational-expectations-hypothesis.html
• Tyler Cowen on why-the-theory-of-comparative-advantage-is-overrated  Thanks Mark
• John Quiggin on market-monetarism-a-first-look
• The always interesting David Glasner on keynes-on-the-fisher-equation-and-real-interest-rates
• Robert Gordon on the Phillips curve is alive and well 
• Edward Lambert on nick-rowe-says-it-is-hard-for-an-economy-to-get-stuck-in-a-liquidity-trap-but-it-is-actually-easy, an-effective-demand-look-at-the-1980-recession-to-envision-the-next-recession
• Steve Roth on specifying-demand-nick-rowe-meets-steve-keen-on-his-own-ground
• RBarbera on exit-keynes-the-friedmanite-enter-minsky  Thanks Mark
• Nick Rowe on for-david-andolfatto-why-i-switched-from-it-to-ngdplt, is-ngdplt-a-perfect-guard-dog-a-challenge
• David Andolfatto on ngdp-targeting-and-taylor-rule
• Simon Wren-Lewis on austerity-and-living-standards
• and then Chris Dillow on bringing-economics-into-disrepute
• Carola Binder on low-interest-rates-savers-and-recovery

General

• Brad De Long on central-banking-banking-camp-vs-macroeconomics-camp
• Jared Bernstein on a-quick-revisit-to-the-is-economics-a-science-debate
• Joshua Neeley on the-libertarian-and-union-organizer-can-friends
• James Hamilton on coping_with_high_oil_prices, syria_and_the_world_oil_market
• John Quiggin on war-and-waste-crossposted-at-crooked-timber 
• Harry Clarke on ronald-coase-rip
• Mike Konzal on how-ronald-coase-demolished-current-libertarian-ideas-about-property
• Dianne Coyle on were-all-coaseians-now
• John Cassidy on ronald-coase-and-the-misuse-of-economics
• Stephen Gordon on what-is-the-link-between-unionisation-and-inequality
• Jonathan Portes on migration-and-productivity
• Chris Dillow on on-wage-led-growth, a-capitalists-recovery
• Guan Yuang on whistleblowers-snowden-press-global
• Menzie Chinn on quantitative_and_credit_easing_Vs_forward _guidance
• Mark Thoma gives us Tim Taylor on global-supply-chains-and-the-changing-nature-of-international-trade 
• and he gives us paul-krugman-years-of-tragic-waste
• Nicholas Gruen on institutions-and-public-goods-the-graphic
• Steve Roth on did-the-baby-boom-labor-force-surge-cause-the-great-inflation
• Mike Konzal on why-keynes-wouldnt-have-too-rosy-a-view-of-our-economic-future 
• and Kruggers has his say auto-corect-nt-wokring-wonkish

Brian Banisch ( Climate)

• climate-clippings
• Greg Mankiw on My Climate Acton Plan
• Jeff Pross on just-degree-warming-kansas-wheat-production-20-percent  Thanks Brad

Andrew Gelman (   your friendly omnipresent Statistics Guru)

• post-publication-peer-review-how-it-sometimes-really-works
• il-y-a-beaucoup-de-candidats-democrates-et-leurs-ideologies-ne-sont-pas-tres-differentes-et-la-participation-est-imprevisible
• evaluating-evidence-from-published-research
• popper-and-jaynes
• does-it-matter-that-a-sample-is-unrepresentative-it-depends-on-the-size-of-the-treatment-interactions
• a-locally-organized-online-bda-course-on-g-hangout
• what-we-need-here-is-some-peer-review-for-statistical-graphics
• Adam Ozimek on will-big-data-bring-more-price-discrimination  Thanks Mark
• Kaiser Fong on statistics-and-big-data-a-pending-marriage, timid-testers-evidence-from-a-suppressed-study

Dave Giles ( Your Friendly Canadian  Econometrics Professor)
We are waiting Dave!!! but he is sorry   An invasion of Canada has been averted!

• francis-smart-on-thiknum-data-resource
• some-more-papers-for-your-to-read-list  I think mainly for the econometric wonks but read for yourself!
• more-on-multiple-bubbles
• ten-things-for-applied-econometricians

Dianne Coyle ( The greatest quirky of all time) and Frances Woolley ( an expert on 'hotness') Quirky + book reviews

• Liveo Di Matteo on can-ikea-stay-profitable
• Dianne on poetry-not-economics , a-book-for-geeks-fun, learning-about-development-economics
• Tim Harford gives us the-financial-times-reviews-the-undercover-economist-strikes-back  blatant self-promotion!,low-pay-and-the-rise-of-the-machines, free-riding-a-la-carte, scarce-tactics-2
• Chris Dillow on gareth-bale-value-theory  My boys will love this! and this managerialism-englands-failurel
• Nicholas Gruen on protest-before-the-me-generation  (I am late on this sorry Nick!)
• Harry Clarke on lankov-on-north-korea
• Carola Binder on four-ways-to-answer-economics-questions
• Menzie Chinn on why_do_economists_blog
• Andrew Giles on would-todays-captains-of-industry-be-happier-in-a-1950s-style-world
• Frances on the-dead-grandmother-syndrome-reconsidered

Voxwonk

• recasting-international-income-differences-next-generation-penn-world-table
• five-more-years-g20-standstill-protectionism
• fractal-market-hypothesis-implications-financial-market-stability
• brics-party-over
• external-liabilities-and-crisis-risk
• riksbank-wrong-about-household-debt
• sovereign-default-risk-and-banks-europe-s-monetary-union
• unintended-consequence-wto-membership
• low-how-long-estimating-ecb-s-extended-period-time
• fiscal-stimulus-times-high-public-debt-reconsidering-multipliers-and-twin-deficits
• predicting-effects-regional-trade-agreements
• offshoring-firms-innovate-more-evidence-european-manufacturers
• technological-progress-thing-past
• why-do-multinationals-pay-less-profit-tax

Sinclair Davidson has to be joking!

A friend asked me to comment on this article by Sinclair Davidson.
Although it is only in a power-point presentation I thought I would address some of the problems Sinclair has when he talks about an area outside his level of expertise.

Although the talk is about Australia and the GFC it is more about the Great Depression.
This is an area I know Sinclair knows little about so I approached this presentation believing it would be full of inaccurate data and misleading assertions. I was not disappointed however these are can be easily picked up by a graduate.

 First of all he relies to two people to look at the Depression and the USA. Mises who proclaims the discredited liquidationist school approach and Amity Shlaes. Shlaes wrote a book about Calvin Coolidge. She, like Katesy is a big fan of his. She neglects to mention 38% of his term in office the US economy was in recession. Great record during the 'roaring twenties'!.
We find that her 'examination of FDR was not of a high order. Indeed her facts were 'ahem' 'doctored'. She counted as unemployed people who actually had a job!

When he examines FDR he merely looks at Expenditure as a % of GDP? Any self respecting economist would look at the CHANGE in the structural part of the budget. As it is Brad De Long has had a go at this and the largest change was in 1936 from deficit to surplus!

He next tries to say the economic contraction in 1936/37 was due to monetary policy as Friedman and Schwartz state in their tome.However Romer and Romer demolished that sometime ago, If it stopped the economy dead in its tracks in 1937 why did it have NO impact in 1941?

He tries to say that going off the gold standard had no effect. However he was told by me many moons ago countries did not devalue and leave the gold standard at the same time. Some like the UK and Australia took some time about it. Germany for instance never devalued. Therefore he knows this is deliberately
misleading.
Next we come to Australia and the Great Depression. Even here Sinclair doesn't know all the facts.

He then goes on to misunderstand the difference between the credit crunch which started in 2007 and the GFC which occurred in 2008. Read this to understand the difference and the subject! This gives you the whole kitten and caboodle!

He also implies if a central bank raises the monetary base then it will feed through to the economy. EXCEPT during the depression when the fed increased the monetary base substantially M3 actually fell!  whoopsy.

He can't help himself by asserting Paul Krugman wanted a housing bubble when he knows Krugman was being ironic at the time.He knew this as well. afterall if Arnold Kling can admit he got it wrong surely Davidson does not have to be so petty and do it in such an inaccurate and misleading way!

He puts a lot of the blame of the GFC on the US government via CRA lending. I find it striking he didn't even know CRA loans were voluntary ( see my article and Krosner's speech). See here for example.I have actually written about this before here and here.  On Wallison's bizarre notion of what is a sub-prime loan see Mike Konzal's demolition. Under Wallison the median loan issued was sub-prime. This is how ridiculous it was.Ii brought this to Davidson's attention when he first attempted this rot. So he must know of this.So again he has put forth delibrately inaccurate information.

He asserts that the Australian stimulus was far to large. However if this was the case then the output gap would have been closed very quickly and thus cash rates would have risen commensurately. This is easy to  to see whether this occurred or not. Observing the official cash rate we see no such thing did!

He also believes there is little chance of fiscal policy working in an open economy. The theory behind this has one economy expanding whilst all others do not. This did not occur during the GFC as Ken Henry told a Senate estimates committee ( or during the Great Depression).Two guesses why?
Furthermore we know this does not occur anyway.

He also says if the project isn't shovel ready then it shouldn't go ahead. This is an argument for simply going ahead and having a recession. Nice for a public sector employee ( how ironic )to urge but not for those in the private sector. If projects aren't available then you look for projects that can be done. Canada and NZ are firm examples of this! They waited too long and hey presto they got their recession!

Sinclair next time you are going to do a presentation I will do a review of of free of charge so you do not make so many errors and make a such a large fool of yourself!
Stick to something you know and understand.

Oh and on the 364 economists and Margaret Thatcher. Not surprisingly Davidson and Samuel J are BADLY wrong.

Have you people at Catallaxy ever heard of research at all?

Update

I have also been asked to comment on Davidson's latest article concerning the stimulus.Suffice to say Treasury via David Gruen issued a mea culpa. Davidson never has for his numerous errors ( too many Davidsongates maybe perhaps even Davidsonfences!) Indeed in the article he claims Ricardian Ambivalence supported him. In fact it was DR Page on that blogsite. oops!

Say no more.

The ALP has played the wrong strategy

To my mind the ALP has had a wretched campaign.

1. After starting off brightly and being 'Prime Ministerial' Rudd then became somewhat flaky  and behaved like an Opposition Leader and a bad one at that. This is a constant theme over all of the Government's terms so my guessing is no matter which advisers are advising they are all bad, very bad.
2. They keep harping on how much the coalition will cut and the $70 billion black hole. Tony Abbott is a big government conservative. So was he government he served in previously. Think about it the previous Coalition government under John Howard increased middle income welfare substantially. Whenever the ALP has ever tried to cut back on any of this welfare the Coalition has always voted against it. There is little chance they will adopt an austerity package particularly since the bureaucracy will not recommend this. Put simply this scare campaign has no legs thus no-one is buying it.

They needed to tell the economic story much better, They needed to tell us why nominal  GDP growth is so low and why it will continue to be so for some time and hence why the budget cannot and should not be attempted to be brought into balance yet.

Related to his they needed to show why the major problem is a structural problem with taxation. There isn't a problem with spending. If there was cash rates would be rising not falling.

However they have not done this.

We know now that 2007 wasn't a one-off for Rudd. He is not a good campaigner. Nor does he have a good team around him. Bye Bye!!