Quotes of the day

To take a net short position [in the US Dollar] now would be illogical. The boat is extremely crowded.--Dennis Gartman (DISCLOSURE: I am short EUR and long CAD in the personal account).

The President’s new budget plan provides insufficient detail to support his claim of $4 trillion of deficit reduction over 12 years. But if we stipulate that amount, it is likely that the President’s new budget proposal would result in $1 trillion more debt over the next ten years compared to the House-passed Ryan plan, and maybe more.--Keith Hennessey

Perhaps the most interesting question is why the FDIC would write a report that could prompt guffaws from financial experts. Two possible reasons come to mind. First, the FDIC made these kinds of claims throughout the debates that led to Dodd-Frank, and somehow they worked. The FDIC was given extraordinary new powers under the new resolution rules, even though the FDIC’s track record in handling large cases is not good. Second, the FDIC has been floundering in its efforts to implement Dodd-Frank’s new requirements. It may be that the report is designed to distract attention away from growing fear that the living will requirement will not be effectively implemented, and that the resolution rules are a disaster.--David Skeel

First of all, while it is technically true that the federal tax take was "around 20% of GDP" during the Clinton era, this was only true at the height of the stock market bubble. Tax revenues exceeded 20% of GDP for exactly one year: 2000. The average tax take under Clinton was 19%. And if you exclude 1999 and 2000, the very height of the bubble, it was more like 18.5%. Without arguing about whether our tax system is fair or not, the fact is that the federal income tax is the most variable part of the code, and the federal income tax is now very progressive; it collects most of its revenue from people at the top. (Whether it should collect even more is an argument for another day.) Because it collects most of its income from people at the top, and because the incomes of the wealthy are more variable than the incomes of the poor and middle class (Warren Buffett's income can drop by $300,000; mine can't), we're going to get deep troughs in recessions, and high peaks in boom times. ... Saying "all we have to do is go back to the tax rates under Clinton" is effectively saying "all we need is another asset price bubble that funnels a huge amount of money into the pockets of the rich". This seems neither particularly feasible, nor desirable. --Megan McArdle

Have you noticed all the huge antiwar demonstrations in the last twelve months? Yeah, me neither. It turns out that a lot of the energy for the movement seems to have been provided by Democrats who are a lot less worried about wars conducted by Democratic presidents. Or at least who believe that advancing the Democratic agenda is much more important than trying to end the wars in Iraq and Afghanistan. This is by no means the whole movement--but it was enough that once a Democrat took office, both the numbers at the demonstrations, and the organizational capacity of the movement as a whole, dwindled away to near-nothingness.--Megan McArdle

Researchers found that job applications containing an attractive picture received roughly a quarter of the responses of one with a plain picture or no picture at all, if the recruiter was a woman. The researchers believe that the reason is that many human resources women are young and in their 20s and subconsciously they do not like extra competition. ... Women who put no picture on their CV were 22 per cent more likely to receive a response than women with a plain picture and 30 per cent more likely than women with an attractive picture. They also that 96 per cent of the company recruiters turned out to be women, typically in their 20s and single. --Richard Alleyne

There's a reason it took centuries for the west to evolve modern economies, the kind where basically everyone is rich by global or historical standards. This stuff is really complicated. The simplest product you buy could not have been brought to your market without a thousand institutions and systems, from double-entry bookkeeping to anti-fraud statutes to telephones and commodity brokers and universal literacy and rail rights-of-way. This stuff cannot be developed overnight, and it cannot be developed by one person, one group, or one plan. And in the end, there is no substitute.--Megan McArdle

It's pretty well known in financial circles that [Donald Trump] is a deadbeat.--anonymous banker

I remember back several years ago that Trump claimed that one of his casinos represented only 2% of his net worth. The casino was bankrupt. 2% of zero is zero.--Cav

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