"It is easy to confuse what is with what ought to be, especially when what is has worked out in your favor."
- Tyrion Lannister

"Lannister. Baratheon. Stark. Tyrell. They're all just spokes on a wheel. This one's on top, then that's ones on top and on and on it spins, crushing those on the ground. I'm not going to stop the wheel. I'm going to break the wheel."

- Daenerys Targaryen

"The Lord of Light wants his enemies burned. The Drowned God wants them drowned. Why are all the gods such vicious cunts? Where's the God of Tits and Wine?"

- Tyrion Lannister

"The common people pray for rain, healthy children, and a summer that never ends. It is no matter to them if the high lords play their game of thrones, so long as they are left in peace. They never are."

- Jorah Mormont

"These bad people are what I'm good at. Out talking them. Out thinking them."

- Tyrion Lannister

"What happened? I think fundamentals were trumped by mechanics and, to a lesser extent, by demographics."

- Michael Barone

"If you want to know what God thinks of money, just look at the people he gave it to."
- Dorothy Parker

Friday, December 30, 2011

Winter Is Coming

Did a 2011 overview here. Discussed The Girl With the Dragon Tattoo here.

Forgot to mention Johnny Depp's second Hunter S. Thompson movie The Rum Diary, where Thompson puts the bastards on notice. Also, there was the George R.R. Martin's A Dance of Dragons and HBO's Game of Thrones. 

Tyrion Lannister was great and the scene of Eddard Stark's execution was the most shocking and heartbreaking scene I've witnessed in a while, with the man from the Nightswatch Yoren clutching Arya and yelling at her "Look at me! Look at me!" And afterwards she looks at the blue sky where a flock of birds flies.
Really enjoyed The Girl with the Dragon Tattoo. I liked the Karen O, Trent Reznor, and Atticus Finch cover of Zeppelin's "Immigrant Song" at the opening and the Swedish setting with its social democratic trains. It was funny that the killer listened to Enya and Mikael Blomkvist sported dark speedo underwear. Hopefully they'll make it into a franchise as has been suggested.

The late, great Hitchens on Stieg Larsson, his books and Sweden, published in December 2009.

Wednesday, December 28, 2011

The Problem by Krugman
Richard Koo has another paper on balance sheet recession out (pdf), with good charts for a number of countries. I still have some differences with him over monetary policy — I still don’t understand why he doesn’t see debt-eroding inflation as something helpful in dealing with debt overhang — but his view of the sources of our Lesser Depression is completely right.

Tuesday, December 27, 2011

Triffin's Dilemma And the Global Safety Shortage by Yglesias

What a weird year 2011 was. The highlight was meeting Laetitia Sadier. Steely Dan at the Ravinia Theater was amazing. Also, Calexico covering Love was a great moment. Also, Archers of Loaf rocking out at the Onion Blockparty. The movie Drive was cool. Christina Romer wrote about NGP level targeting, Bernanke was annoyed when asked about it and a Time columnist wrote in support of it. Chicago Fed President Charles Evans stepping up and arguing that the Fed should do more.

The fall of Saddam led to Tahir square and Dan "Double D" Davies sparked Occupy Wall Street with a Crooked Timber post. The European Feedback Cycle of Doom kicks in after the ECB raised rates in April. Muammar Gaddafi, Osama bin Laden, Václav Havel, Kim Jong-il and Christopher Hitchens all die.

Pepper-spraying cop at UC Davis.

Hitchens on North Korea.

David Brooks is Projecting His Self Indulgence Again by Dean Baker

Sunday, December 25, 2011

Why the Global Shortage of Safe Assets Matters by David Beckworth
In the early-to-mid 2000s, the Fed exacerbated the asset-shortage problem as its loose monetary policy got exported via fixed exchange rates to much of the emerging market world which in turn recycled it back to the U.S. economy via the "global saving glut" demand for safe assets. (For more on this point see this post and my paper with Chris Crowe.) Since late 2008, both the Fed and the ECB have worsened the asset-shortage problem by failing to first prevent and then restore nominal income in each region to its expected path. In other words, since 2008 both the Fed and the ECB have passively tightened monetary policy and this has caused some of the AAA-rated securities to disappear. (Yes, some of the AAA-rated MBS and sovereign debt would have defaulted on their own, but some of them like French sovereigns would have maintained their safe asset status were it not for insufficient aggregate demand caused by passively tight monetary policy.)
I would look into the "loose monetary policy" and the context of it.