Quotes of the day

In seeking to evaluate our conduct over the past year, we must be careful to avoid two opposite errors: the first is being too easy on ourselves and the second is being too hard.--A.W. Tozer

We're only a few years away from a point where no mating will ever occur because no one will pass the background check. If you knew everything about another person's history, there would always be at least one show stopper. In a simpler time, you could fall in love before you found out any damning information about your partner. I'm not sure that was better.--Scott Adams

I believe the villain is Keynes and there was a Keynes line that in the long run we are all dead. Whether or not that is true, I believe that in the long run Keynesianism will be dead and that the problem with never thinking about the long run is that in the long run, the short run becomes the long run.--Peter Thiel

Was the “animal spirits” model wrong? That’s not the right question. The question is; “Was it useful?” I suppose it might have had some value. It pointed to the problem of unstable nominal spending in a market economy, and the need for the government to insure that NGDP was stable. So in that sense Keynesian economics was a step forward. But it is no longer a useful model, i.e. a useful social construct. And some day my gold market model of the 1930s will also be obsolete. When physicists developed models that didn’t need concepts like dark energy and dark matter, they threw those concepts into the trash bin. It is time to throw Keynesian economics away. The pre-Keynesians knew wages and prices were sticky, and that’s the only useful part of Keynesian economics.--Scott Sumner

... when I asked one of my professors at Chicago which economic school Galbraith belonged to, he thought for a moment, then said "it's less of a school than a sort of conspiracy theory."--Megan McArdle

Cutting wages increases the quantity of labor demanded. If labor demand is elastic, total labor income rises as a result of wage cuts. Even if labor demand is inelastic, moreover, wage cuts reduce labor income by raising employers' income. So unless employers are unusually likely to put cash under their matresses, wage cuts still boost aggregate demand.--Bryan Caplan

Historically, the median CPI has been 50% more accurate at gauging future inflation than the traditional CPI (based on the Cleveland Fed's research), and the median CPI is now suggesting that rising inflation is not an imminent problem. In fact, the decrease in November's median CPI to 1.3% from 1.45% in October was for 14th consecutive monthly drop in median CPI inflation.--Mark Perry

I find the reaction to my post last week about undeserving deadbeats rather . . . odd. Odd, because it came mostly from the left, who seemed to think that refusing to pay your mortgage so that you could spend more time and money on cruises and Disney furniture was not merely rational, but admirable.--Megan McArdle

A recent report by the left-leaning Center for American Progress blasts conservative billionaires David and Charles Koch for funding a campaign of “hate” against the White House. It said the Koch’s — funded by their oil, gas and timber conglomerate — have spent millions of dollars trying to block President Obama’s stimulus package, climate-change policies and health-care reform. The report said the funding has been channeled through the Cato Institute, Heritage Foundation and Competitive Enterprise Institute. It’s central message: Billionaire ideologues are bad for democracy. Yet missing from the report was one central fact: The Center for American Progress, itself, receives support from politically active billionaires, including George Soros and Herbert and Marion Sandler.--Robert Frank

On the campaign trail, Barack Obama vowed to take on the drug industry by allowing Americans to import cheaper prescription medicine. "We'll tell the pharmaceutical companies 'thanks, but no, thanks' for the overpriced drugs -- drugs that cost twice as much here as they do in Europe and Canada," he said back then. On Tuesday, the matter came to the Senate floor -- and President Obama forgot the "no, thanks" part. Siding with the pharmaceutical lobby, the administration successfully fought against the very idea Obama had championed. ... No surprise here: Lawmakers, and the White House, are addicted to drug money. The industry has pumped upwards of $130 million into federal elections over the past decade and is now among the top 10 donors, according to the Center for Responsive Politics. At the same time, the White House needed the industry to spend its millions of dollars in advertising money on support of the health-care legislation, not against it. --Dana Milbank

Either the Abu Dhabi Investment Authority will have to show that they were indeed unsophisticated - entertaining in itself - or that Citi were actually fully aware in December 2007 of the carnage that was to come in 2008/9. Remember Chuck Prince was "still dancing" only a couple of months before the ADIA transaction. Catching falling knives is simply a question of timing. The Kuwait Investment Authority just about succeeded squeezing something out of a Citi transaction. ADIAs timing on Barclays was also better, but they simply failed in the case of Citi. Take your lumps, people, and move on.--Andrew Clavell