Quotes of the day

In 1938 Buckminster Fuller coined the term ephemeralization to describe the increasing tendency of physical machinery to be replaced by what we would now call software. The reason tablets are going to take over the world is not (just) that Steve Jobs and Co are industrial design wizards, but because they have this force behind them. The iPhone and the iPad have effectively drilled a hole that will allow ephemeralization to flow into a lot of new areas. No one who has studied the history of technology would want to underestimate the power of that force. ... Give hackers an inch and they'll take you a mile.--Paul Graham

Apparently [Rupert] Murdoch and [Steve] Jobs are both anticipating that education and media will become primarily tablet-based in the future. Hence, the reason why Murdoch would want a top educator like [former schools chancellor Joel] Klein on board for this educational entrepreneurial endeavor.--Julia La Roche

Sarah Palin's "Being There" ascendancy may strike some as absurd, but it provides a case study for what now counts as news. Today, going viral matters more than the information itself. The object lesson that Palin brings to politics is something we should fear for the financial markets, where going viral can transform information from being the bedrock of market efficiency to a source of irrationality, even crisis. ... Information is moving from being the bedrock of market efficiency to a source of crisis. The risk for the market is not the news itself, but what news gets drilled home through so many channels that people act on it; we cannot anticipate when information might go viral and sweep the markets.--Rick Brookstaber

In archaeology you uncover the unknown. In diplomacy you cover the known.--Thomas Pickering

Harvard educated economist Brad DeLong's parents also went to Harvard, but so did two of his grandparents, two great-grandparents, and three great-great grandparents. He has been designed by natural selection to be a progressive, and he advocates the memes that have hijacked his gene pool very consistently. ... [All economists] have solutions, albeit solutions that are wildly different. In the middle ages if you didn't feel well a doctor would give you a variety of orthogonal cures: laxatives, emetics, bloodletting, herbs. If they didn't have a cure they could not have make a career out of it. Of course, the best cure back then was to drink lots of fluids and rest; basically, ignore the quacks and do nothing. It's similar for macroeconomic problems, where prior to Herbert Hoover, the federal government would not do much, and growth rates were as high as ever in our history. --Eric Falkenstein

These [Chinese infrastructure] projects don't have to go to the market for loans; the government directs the state-owned banks to lend to them, at interest rates decided by the state. There's no opportunity cost to the money, since it's not like the rail ministry would otherwise be building a chain of noodle shops. And the ridership projections are vetted by the same people who want to build 16,000 km of high-speed rail. Prices are really useful. But in whole large sectors of the Chinese economy, particularly the banking sector, the government sets those prices. This means huge information loss, and the concomitant possibility that there is a vast misallocation of resources. Don't those things happen in markets? Hell yes: witness the housing bubble. On the other hand, witness East Germany. To get a really catastrophic misallocation of resources, it seems to take a government; corporations can only screw things up on an artisinal scale. For that matter, it's worth noting that our government has spent the last seven decades trying to keep the price of housing low, and that much of that intervention, such as the creation of mortgage securitization, ultimately significantly contributed to the crisis. It's worth remembering that at the time they were built, all those useless houses looked like prosperity. So too, massive mispricing in China may look pretty sweet--unless a hiccup suddenly leaves the government with a hell of an expensive white elephant. Or lots of them. As anyone who has contemplated purchasing a luxury car will know, just because something is really awesome, doesn't mean it's a good idea, economically speaking. Buying without knowing the price is dangerous no matter where you are.--Megan McArdle

One of the largest union-administered health-insurance funds in New York is dropping coverage for the children of more than 30,000 low-wage home attendants, union officials said. The union blamed financial problems it said were caused by the state’s health department and new national health-insurance requirements. The fund is administered by 1199SEIU United Healthcare Workers East, an affiliate of the Service Employees International Union. Union officials said the state compelled the fund to start buying coverage from a third party, which increased premiums by 60%. State health officials denied forcing the union fund to make the switch, saying the fund had been struggling financially even before the switch to third-party coverage. The fund informed its members late last month that their dependents will no longer be covered as of Jan. 1, 2011. Currently about 6,000 children are covered by the benefit fund, some until age 23. The union fund faced a “dramatic shortfall” between what employers contributed to the fund and the premiums charged by its insurance provider, Fidelis Care, according to Mitra Behroozi, executive director of benefit and pension funds for 1199SEIU. The union fund pools contributions from several home-care agencies and then buys insurance from Fidelis.--Yuliya Chernova

... while the rapture doesn't strike me as precisely likely, I don't have enough data to rule it out, either.--Megan McArdle