Thursday, February 10, 2011

Quotes of the day

Most [sudden, unintended acceleration of Toyota car] incidents reported to the DOT appeared to be caused by drivers stepping on the gas instead of the brake. The National Aeronautics and Space Administration, which conducted the study with the DOT, "observed that the vast majority of complaints involved incidents" that began when the car was stationary or at a low speed. The most likely cause in such incidents was "pedal misapplication," with the driver stepping on the gas, rather than, or in addition to, the brake, the report said.--JOSH MITCHELL

.... public companies average 1.199 private-jet seats for each billion dollars of sales. Private-equity-owned firms average .485 fewer private-jet seats.--Shira Ovide

... the valuation of Twitter makes sense even if it will probably go down. That’s the way of lottery tickets: their value is nearly always higher than their payout. And people looking to buy into Twitter at a $5 billion or $10 billion valuation aren’t doing so because they’ve discounted a bunch of predictable cashflows and decided that the present value is that ginormous. Instead, the investment is more in the form of a hedge. Twitter just might turn out to be one of the most important and valuable companies in the world. And if it does, then everybody will have wanted to get in around now. If you have that opportunity, it’s a hard one to turn down.--Felix Salmon

Big banks like Citigroup and Morgan Stanley, which were battered by the 2008 financial crisis, are once again on solid ground. But a slew of documents, e-mail messages and minutes of crucial regulatory meetings released recently by the Financial Crisis Inquiry Commission provide fresh detail about just how close to the brink both firms came.--SUSANNE CRAIG and BEN PROTESS

But here is the essential fact I want to emphasize and have you think about today: The Fed could not monetize the debt if the debt were not being created by Congress in the first place. The Fed does not create government debt; Congress does. Deficits and the unfunded liabilities of Medicare and Social Security are not created by the Federal Reserve; they are the legacy of Congress. The Fed does not earmark taxpayer money for pet projects in local communities that taxpayers themselves would never countenance; only the Congress does that. The Congress and administration play the dominant role in creating the regulatory environment that incentivizes or discourages job creation. It seems to me that those lawmakers who advocate Ending the Fed might better turn their considerable talents toward ending the fiscal debacle that has for too long run amuck within their own house.--Dallas Fed president Richard Fisher

I have described my philosophy as "Libertarian, but without the crazy stuff." Libertarians are for personal freedom, small government, and a defensive-sized military. That sounds good to me. But I think a better objective is something along the lines of maximizing the public's long term happiness. So while a libertarian might favor allowing his suburban neighbor to operate a bazooka firing range in his back yard, I'd be against that, even if it required a slightly larger government to prevent it. Furthermore, I believe that if you identify with any political group or philosophy that has a name, you are far more susceptible to confirmation bias than someone who doesn't. And as a general rule, I don't trust anyone with a strong opinion on a complicated topic. On the topic of the U.S. budget, my current suspicion is that the problem has grown so large that there is no practical way to eliminate the deficit by cuts alone, without making things worse. But I assure you that I want to be wrong because being right means my taxes will go up substantially.--Scott Adams

... the federal government is not a charity. The main difference is that charities are funded by voluntary contributions, and the government is funded by forceful expropriation. So the self-regulating mechanism of a charity on the amount to pay out is broken. Indeed, instead of asking how much money we actually have, the government (and you) asks how much money we need to pay out. Aside from the immorality, the problem with that question is that the "demand" for free stuff is practically limitless. People could "demand" twice their benefits today. They don't necessarily have to wait for more people to retire or get sick. ... I don't know how much politicians will redistribute income to retirees and sick people instead of wars and bailout in 20 years. But I know Americans would be better off if each of those four items were zero.--Phil Maymin

I'd rather be a lightning rod than a seismograph.--Ken Kesey

It is not entirely clear that your veneration of traditional academic achievement is exactly well placed. Which two freshmen at Harvard have arguably been most transformative of the world in the last 25 years? You can make a reasonable case for Bill Gates and Mark Zuckerberg, neither of whom graduated.--Larry Summers, to Tiger Mom Amy Chua

If the logic of back-in parking is so clear, why doesn't everyone do it? Difficulty, or perceived difficulty, seems to be the reigning explanation. Casual sexism (of the sort summed up by this video) holds that women struggle with back-in parking, although commenters of both genders termed it difficult on my blog. More troubling are studies that claim to find a measurable, if slight, parking "performance gap" between male and female drivers. One NHTSA study, "Field Measurement of Naturalistic Backing Behavior" (conducted to help design backup warning systems), found that "the male driver's mean maximum backing speed was generally faster than the female's and reached statistical significance on two of the tasks," one of those tasks being "backing into a perpendicular parking slot." A similar study, by Claudia C. Wolf and colleagues at Germany's Ruhr University-Bochum, asked male and female drivers of varying experience levels to park an Audi A6 in various ways (back in, parallel, etc.) in a closed-off multistory car park. They found that women took longer to park the car than men. This might be seen as a result of the general tendency for men to take more risks in driving than women (e.g., men drive faster, closer to other vehicles, more often without seatbelts, more often under the influence of alcohol), but there was another interesting result: Even though men parked more quickly, they also parked more accurately, as measured by distance to neighboring cars. Of course, measuring these differences is easier than explaining them. Are there biological differences that give men an edge in handling a car, or do the results just reflect a wider societal belief that men should be better at handling a car? Some psychologists suggest that this belief itself affects the actual performance of drivers, in a phenomenon called "stereotype threat." In a study in Australia, women drivers in a driving simulator who were confronted with negative stereotypes about women drivers were twice as likely to collide with a jaywalking pedestrian as women drivers not presented with the stereotype.--Tom Vanderbilt

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