Origami Mathematics: Via Robert Lang

The Economic Value of Teeth

This Time is Different: A Panoramic View of Eight Centuries of Financial Crises

The Aleph Blog » Blog Archive » Another Dozen Notes on Our Manic-Depressive Credit Markets

Capitalism is good, but Capitalists often abuse it. Short-sighted
capitalists play for short-term advantage, and end up burning up
relationships. Longer-term capitalists play fair, because they not
only want deal one, but deals two, three, four, etc. They play fair
because they will do better in the long run, even if they are
intelligent…...

Economics isn’t everything. Smart businessmen know that a good
reputation is golden. They also know that happy employees are more
productive. Suppliers that get paid on time are more loyal. These are
the benefits of ethical, long-run thinking.

During much of the 2000s, the housing boom was generated by six factors:

1. Interest rates artificially pushed down by the Federal Reserve to try to rotate from high-tech to construction as a leading sector, and so avoid a recession.
2. Closely related, interest rates artificially pushed down by the Federal Reserve to try to stem incipient deflation, and so avoid a depression.
3. Lower spreads than in the past on long-term mortgages out of confidence that the Fed does have and will keep inflation licked.
4. The filling-up of America so that you can no longer build a detached single-family house within half-an-hour’s driving time of the interesting places people want to be, and the consequent rise both in current location premia and expected future location premia.
5. Interest rates artificially pushed down by foreigners seeking political risk insurance—both private (i.e., get your money into a Citigroup account certain to be safe) and public (i.e., keeping the renminbi low and U.S. imports high in order to avoid unemployment in the streets of Shanghai.
6. A speculative housing bubble leading to a crash.