Will The Investor Class Abandon the Republicans?
October 6th, 2008 by Jon Taplin
Third quarter 401K statements will start to arrive at the end of this week. John Zogby
Third quarter 401K statements will start to arrive at the end of this week. John Zogby
My senior year of high school my aunt gifted me with $1000 in an IRA thru Legg Mason. I just liquidated those shares to move everything under Ameritrade’s umbrella. The $1000 in 1998 in $704 today.
If I was 25 years older and that was $100K at its start, I’d not be a happy camper either.
My senior year of high school my aunt gifted me with $1000 in an IRA thru Legg Mason. I just liquidated those shares to move everything under Ameritrade’s umbrella. The $1000 in 1998 in $704 today.
If I was 25 years older and that was $100K at its start, I’d not be a happy camper either.
Unfortunately, they will be scared.
But the appropriate boogey man is a two-headed beast: the Republican & Democratic Parties each get a head.
Unfortunately, they will be scared.
But the appropriate boogey man is a two-headed beast: the Republican & Democratic Parties each get a head.
1. Investment guru Jim Cramer on NBC this morning told investors to bail out of the market if they needed their money in less than 5 years! (Finally, my spouse bailed, leaving us down 30% from 2 years ago, but at least with some funds for future retirement!)
more here: http://www.msnbc.msn.com/id/27045699/
2. Any thoughts on the boy-wonder selected to administer the bailout — 35 year old tech investment banker and Goldman Sachs VP, Neel Kashkar?
more questions and concerns about Paulson’s choice at
http://www.openleft.com/showDiary.do;jsessionid=D049D83AFFF6BD9AECCACD0EDFA4D4A8?diaryId=8867
1. Investment guru Jim Cramer on NBC this morning told investors to bail out of the market if they needed their money in less than 5 years! (Finally, my spouse bailed, leaving us down 30% from 2 years ago, but at least with some funds for future retirement!)
more here: http://www.msnbc.msn.com/id/27045699/
2. Any thoughts on the boy-wonder selected to administer the bailout — 35 year old tech investment banker and Goldman Sachs VP, Neel Kashkar?
more questions and concerns about Paulson’s choice at
http://www.openleft.com/showDiary.do;jsessionid=D049D83AFFF6BD9AECCACD0EDFA4D4A8?diaryId=8867
zak,
It appears that money would have been better off under your pillow, where simple inflation would only have reduced it to $798.
And if you have the stomach to consider that $1k in 1998 dollars was worth $1,267 of today’s, it appears you’ve only got 55% of what you did when you received the money.
I assume you will not be voting for the Republicans this time around.
zak,
It appears that money would have been better off under your pillow, where simple inflation would only have reduced it to $798.
And if you have the stomach to consider that $1k in 1998 dollars was worth $1,267 of today’s, it appears you’ve only got 55% of what you did when you received the money.
I assume you will not be voting for the Republicans this time around.
MS,
That article to which you linked seems to be the only information out there. Google still come up with a ‘did you mean’ query featuring a similar name, and the only three links that reference Mr. Kashkar are all tied to this same article.
Google image search draws a blank. He seems to have a remarkable low public profile for someone trusted with nearly 3/4 of a trillion public dollars.
MS,
That article to which you linked seems to be the only information out there. Google still come up with a ‘did you mean’ query featuring a similar name, and the only three links that reference Mr. Kashkar are all tied to this same article.
Google image search draws a blank. He seems to have a remarkable low public profile for someone trusted with nearly 3/4 of a trillion public dollars.
Jon,
I think I’ve just put my finger on what is so fundamentally wrong about the “laissez faire, low taxes rhetoric” you cited above.
The idea is that it keeps markets free, and therefore capable generators of accurate price signals. But in practice, it means stripping external costs from transactions right across the board, leading to price signals that steadily – then suddenly – diverge from actual economic reality.
You end up flying by instruments in a plane with no working instruments, at all. The only free left is free fall.
It bears noting that one of the darkest markets going is the one that governs executive compensation. Is it any wonder that relying on leaders totally detached from economic reality has led to a ‘correction’ that is massively – and unnecessarily – painful?
Jon,
I think I’ve just put my finger on what is so fundamentally wrong about the “laissez faire, low taxes rhetoric” you cited above.
The idea is that it keeps markets free, and therefore capable generators of accurate price signals. But in practice, it means stripping external costs from transactions right across the board, leading to price signals that steadily – then suddenly – diverge from actual economic reality.
You end up flying by instruments in a plane with no working instruments, at all. The only free left is free fall.
It bears noting that one of the darkest markets going is the one that governs executive compensation. Is it any wonder that relying on leaders totally detached from economic reality has led to a ‘correction’ that is massively – and unnecessarily – painful?
And when do you think the last time was that George Bush actually wrote a check or pulled some cash out of his wallet to pay for something at a store? And extend that to a lot of the other a..holes, too.
And when do you think the last time was that George Bush actually wrote a check or pulled some cash out of his wallet to pay for something at a store? And extend that to a lot of the other a..holes, too.
Alex,
I like your terms ‘dark’ and ‘clear’ to describe markets. Also agree that ‘governance’ is often a better word than ‘regulation’. We’re used to saying ‘good governance’ when talking about goals for policymaking. It is free of the reflexively pejorative connotations of ‘regulation’.
Alex,
I like your terms ‘dark’ and ‘clear’ to describe markets. Also agree that ‘governance’ is often a better word than ‘regulation’. We’re used to saying ‘good governance’ when talking about goals for policymaking. It is free of the reflexively pejorative connotations of ‘regulation’.
Thanks for the props. I shared the idea here not 48 hours after it occurred to me, so it’s totally untested, and completely unproven.
That said, I’ve been reconsidering various issues in these terms, and the results are very satisfying.
So far, it seems like an elegant framework, and one that can efficiently sort good policy from bad; distinguish acceptable lobbying from corruption; define healthy competition in opposition to abusive practices; and continue to demarcate a clearly limited role for government, without diminishing the value and effectiveness of the powers government properly reserves.
All this seems important, because what we’ve got now – on all these fronts – is an enormous mess, and a bunch of people so angry with each other that they can’t even see straight, let alone set things straight.
Thanks for the props. I shared the idea here not 48 hours after it occurred to me, so it’s totally untested, and completely unproven.
That said, I’ve been reconsidering various issues in these terms, and the results are very satisfying.
So far, it seems like an elegant framework, and one that can efficiently sort good policy from bad; distinguish acceptable lobbying from corruption; define healthy competition in opposition to abusive practices; and continue to demarcate a clearly limited role for government, without diminishing the value and effectiveness of the powers government properly reserves.
All this seems important, because what we’ve got now – on all these fronts – is an enormous mess, and a bunch of people so angry with each other that they can’t even see straight, let alone set things straight.
I think the simple fact that hiding your money in a mattress would have been a better choice than leaving it in the market says it all. When enough people come to realize that, the real depression hits, because common sense says that investing in corporate America makes a few guys really really really rich, and you end up with less than when you started.
I think the simple fact that hiding your money in a mattress would have been a better choice than leaving it in the market says it all. When enough people come to realize that, the real depression hits, because common sense says that investing in corporate America makes a few guys really really really rich, and you end up with less than when you started.
Alex,
I really hope some branch of the economics profession will get serious about reconnecting their modeling efforts with the reality of political and economic power.
Ragu Rajan has shown some promise in this area. I first noticed him when some blogger pointed to a talk in which he discussed how the new shadow banking system was intensifying risk. This at a time when everybody else was being congratulatory about how modern finance was lowering risk.
But this strain of thought should be of interest to you. Wow! Sometimes economic relationships are influenced by power — whodathunkit?
But all snark aside, Rajan is an example of a prominent academic who has stumbled onto a worthwhile path. I hope his colleagues learn to appreciate that part of his work (currently placed discreetly at the bottom of his publication list as if out of embarrassment) and emulate it. We’ll see if their funders will tolerate that kind of subversion. (oops forgot to close the snark tag there …)
Alex,
I really hope some branch of the economics profession will get serious about reconnecting their modeling efforts with the reality of political and economic power.
Ragu Rajan has shown some promise in this area. I first noticed him when some blogger pointed to a talk in which he discussed how the new shadow banking system was intensifying risk. This at a time when everybody else was being congratulatory about how modern finance was lowering risk.
But this strain of thought should be of interest to you. Wow! Sometimes economic relationships are influenced by power — whodathunkit?
But all snark aside, Rajan is an example of a prominent academic who has stumbled onto a worthwhile path. I hope his colleagues learn to appreciate that part of his work (currently placed discreetly at the bottom of his publication list as if out of embarrassment) and emulate it. We’ll see if their funders will tolerate that kind of subversion. (oops forgot to close the snark tag there …)
Great material, STS. And yes, I find it fascinating. Thanks for the links.
Also, good to see you back here.
Cheers.
Great material, STS. And yes, I find it fascinating. Thanks for the links.
Also, good to see you back here.
Cheers.
Alex,
I should clarify. Seth = STS. I switched computers this morning and my old (more anonymous) ID got populated into the comments form. A while after I started using my first name instead of initials (quite by accident) I noticed the discrepancy. But I felt, perhaps wrongly, that nobody was particularly concerned with either of these identities. Why grab the ‘mike’ just to point out a dumb mistake?
Sorry about the confusion.
Alex,
I should clarify. Seth = STS. I switched computers this morning and my old (more anonymous) ID got populated into the comments form. A while after I started using my first name instead of initials (quite by accident) I noticed the discrepancy. But I felt, perhaps wrongly, that nobody was particularly concerned with either of these identities. Why grab the ‘mike’ just to point out a dumb mistake?
Sorry about the confusion.