Atlas Shrugged in Atlanta

Yes, I am quite excited for this movie to come out!

View all Atlanta events on Eventful

Grad School

Here I am in grad school. Well, I am at Emory, trying to eventually in 5 years or so get a PhD in Economics. And here I want to tell you about some of my 'successes' and things I learned.

Our professors are very intelligent. Just take my macro professor. When he joined the department, its ranking by publications went up by some 20 places. And now he is teaching us calibrations, pareto optimal social planning, social planning in general, dynamic optimization, Bellman equations, and a whole bunch of other things. However, when asked about his opinion on the Austrian view of the Great Depression, the professor's response after additional 5 clarifying questions, was that we may perhaps talk about the Great Depression in Italy, but that he does not believe that Austria had a Great Depression... Otherwise he is probably really good though.

Or our Stats professor. I think that he ranks among the top 10% of economists in the world. Pretty cool. And he also teaches as one.

Or our Chicago-grad micro professor who makes his own micro models (do not confuse for micro-processor). Also very intelligent and loves to give 'tricky' exam questions.

And then here is my class... half made of geniuses with master's degrees in economics and other areas, or with PhDs in physics, and half composed of your 'average guys' (ok, your average PhD students). Hmm, if you don't know which group I am in, try to guess.

I have realized how funny it is to have your 'average guys' be taught by top economists. Well, it is funny if you, like me, like dark humor. Just consider the grades. Our first micro exam ended with a median of 59% (I was the median btw.). Or our first statistics exam where grades spanned from 99% to 7% (I had again my average 56%). And now the macro midterm... where the class distribution of grades looked like this:

Just in case you can't see, the column tags read '70-80', '60-70', '50-60', and 'below 40' and the 'y axis' tells you the number of students within this percentage.

There are good things to compensate for our/my failures though. The lowest grade is B- and grading is done on a scale so, as I like to say, if we all failed we all did well.

And now, back to studying!

Murphy - Krugman Debate Plug-in

The French Response

As the French strike again, I thought of commenting on this, just for fun.

That the French strike about just anything is not surprising to anyone. However, I cannot resist the temptation to comment on this year's #1 strike against raising the retirement age from 65 to 67 (or 60 to 62 for early retirement). Actually, when thinking about this more in depth, the French response to this legislative change is awesome!

Imagine strikes, walking in fresh air, no gasoline means less traffic and less pollutants, and running from the police (what an exercise!). No electricity means getting more sleep. Also, striking means less work, less stress, less of the harmful sitting in one's office. (Let's forget about the trash piling up in the picturesque streets).

This all leads me to conclude that the French in fact are not just striking, they are collectively raising their life expectancy!

What an idea! The French are smart in giving their evil government the right response. 'You raise our retirement age? We live longer!'

I wish I was French... ;)

More on this issue on BBC

Econ Book Club 2010

The book club continued this semester! Here is what we got to read!

The Case for Gold

"But there are further effects that would become apparent during transition to a gold system. ... Unless such a transition begins quickly, we can expect to see the most massive failure of depository institutions in our history.

A movement toward sound money, while opening up all financial institutions to the sort of competition they should have faced all along, will, at the same time, relieve some of the pressure on the most critical of these institutions.

The alternative, of course, is massive government bailouts costing tens - perhaps hundreds - of billions of dollars."

- Ron Paul and Lewis Lehrman, 1982

It took only 16 years and here we had the government spending billions. According to this site, the TARP put some $250 billion into banks. I would like to know how much of this has been returned back and how much never will...

Higher Tax Credit vs. Lower Tax

To quote this article, according to Mr. President B. Obama, "The average tax refund [this year] was 10 percent larger than last year". Well, that may sound great to the few hard core Democrats who still believe that what this Government is doing will one day save this nation from debt, diseases, poverty, swine flu, terrorism, chicken pox, mosquitoes, evil corporations, people who want to be responsible for self, and all the other 'problems' that there are.

To me, this doesn't say anything positive at all, especially because of the way this was done. After all, this must mean one of the following two things 1) more debt now or 2) higher taxes later 3) or both combined.

I am not precisely sure on what an average tax refund is, but judging from the fact that most of my friends receive a refund of $1,000 or higher, 10% being $100, the whole 'higher tax refund' business will be probably quite expensive.

What was the tax refund all about? According to Mr. Obama, most of it was due to "college tax credits, making work pay, college loan relief, and home buyer credits." Well, great, so basically the government gives people incentives to go to college to get a degree that may not give them any sort of advantage, especially due to high unemployment and the fact that a bachelor's degree is today probably as much or even less than a high school diploma 50 years ago. Additionally, we get rolling with bad loans again when people who should not own a house in the first place (and could as well rent for a while) will take a mortgage and buy a house anyways. I am not sure on what a 'making work pay' stands for. I cannot imagine it's something much better than the other tax credits.

My question is, why, instead of making these tax credits, doesn't the government just lower taxes and its expenditures? Not to mention that because of so many tax breaks and all that, way more accountants and other tax experts are employed in this giant tax industry. What if all these people for once had to do something productive? Without tax breaks, they would have to, since otherwise they would have no job.

So yes, if you think tax breaks are good, ask first why lower taxes wouldn't be even better. :)

"I'll spend now, your children will pay for it later on"

Is this what those who prepared the 2011 budget were thinking?

See Dr. Mankiw's blog for the budget in comparison to other years and historical averages...

http://gregmankiw.blogspot.com/2010/02/president-obamas-new-budget.html

The Dollar Bubble

... move your dollar investments into gold, Yuan, and Euros (well, be careful about the last one...)

A 1948 Cartoon

My Readings in Economics professor forwarded this video to us today... It looks old, but a lecture in freedom cannot get any cuter than this :)

Property rights

When reading on Mises today, I got to an interesting comment on the article The Wind and Wave Theory of Property . This person who commented was talking about property rihts to liquids and gases.

I think that this is something we are still missing and have not accounted for.

How could we assign property rights to liquids and gases?

I know you have these days all the emissions trading, EPA, etc..., we can 'buy' a property on the Moon, but no one is selling certificates to a gallon of clean air for example that one would own and destroy according to his/her own likeness.

If we did have property rights to air and water, would people care for them more?

I think they would... I take care of my solid properties, would I take care of my liquid & gas? Sure! Also, in a market for air, where people would have to pay for using it, would the state of our atmosphere improve? Would we have more 'providers' of clean air?

I know, these are just random questions that popped up in my head, but think about them! Wouldn't the market for air make things better? How about China (or other developing nations)? Perhaps its trade surplus would decrease even faster if it were to buy clean water and air from other countries...

Freedom to Fascism - a quest for information on income taxes

Econ Book Club

Our Economics department is outstanding. When I look and see how committed our econ professors are to their work and their students, I have to admit that this is unseen in any other department of our college.

One such example of how great things are could be our Readings in Economics class. Dr. Nesbit, who came up with the idea, takes time every year to get students interested, to find the best books, and to get funding for them, so that student's wouldn't have to pay.

Our class meets once a week to discuss the assigned reading for the particular week. We debate, share our ideas and thoughts, talk about current issues, about opportunities for our growth, and our lives. Here are the books we have read so far:

Atlas Shrugged by Ayn Rand (Summer reading)

Meltdown by Thomas E. Woods

America's Great Depression by Murray Rothbard

You can probably see that our readings are biased towards economic freedom and the Austrian school of thought. Still, it is good to see these views, especially in our world which is becoming more and more socialistic.

What do you think? Have you ever thought of a class like this or been a part of one?

The egg or the omelet?

After reading an article 'The Omelet Has No Rights' by F.A. Harper (which was originally published in 1955) I cannot help but think about the world in a different way. If the UN is the frying pan on which the omelet is being made and who assumes complete control over the 'eggs' in the omelet, what should we do with it?

Should we just watch the omelet?

Could we become one of the eggs in the omelet and change the omelet back to being just 'eggs'?

This is why I want to work for an organization like UN or the IMF or WB one day, I wish I could help them promote freedom via whole 'eggs' rather than 'omelets'.

PS: Whenever I make an egg omelet now, I think I will think of this

Blocked Currency

I really enjoy my International Marketing professors talks about Bangladesh...

Today, I was surprised about the fact that nations can run out of foreign currencies available for exchange, which causes them to restrict imports in certain areas since they want to use the currency available for 'important' goods such as medical equipment, etc... Still, I feel like I may need more information about this... any ideas for sources?

This phenomenon is called 'blocked currency'.

However, what is really the cause of this situation?

Is it the government of the host economy that makes the currency very unattractive (for example Zimbabwe) or is it embargoes posed by outsiders?

Obama Cliffs Notes

I found this quite amusing article at the end of the school year (Spring 2009) and I loved it. I am not a big fan of President Obama's economic policies, but I think that a bit of dark humor doesn't hurt anyone :)

Here is the Obama Dictionary:

"We are not going to get relief by turning back to the very same policies that for the last eight years doubled the national debt and threw our economy into a tailspin."

Translation: Blame Republicans, and tax cuts

It's time to "make hard choices to bring our deficit down."

Translation: Hello, higher taxes!

"The only way to fully restore America's economic strength is to make the long-term investments that will lead to new jobs, new industries, and a renewed ability to compete with the rest of the world."

Translation: Big government.

"We need to make clean, renewable energy the profitable kind of energy."

Translation: Your utility bills are going up.

"If your family earns less than $250,000 a year, you will not see your taxes increased a single dime."

Translation: For now

"I will not sign a plan that adds one dime to our deficits -- either now or in the future.(Applause.) I will not sign it if it adds one dime to the deficit, now or in the future, period. And to prove that I'm serious, there will be a provision in this plan that requires us to come forward with more spending cuts if the savings we promised don't materialize."

Translation: "I promise to fix the problem. And if I do not fix the problem now, I will fix it later, or some future president will, after I am long gone. I promise he will. Absolutely, positively, I am committed to that future president fixing the problem. You can count on it. Would I lie to you?"

Yes, these things definitely do sound funny, until we realize that the Obama administration is digging a hole out of which it will be very hard to get.

What makes me wonder...

Capitalism lacks romantic appeal. It does not send the pulse racing in the way that opposing ideologies like socialism, fascism or environmentalism can. It does not stir the blood, for it identifies no dragons to slay... It is quite the opposite with socialism. Where capitalism delivers but cannot inspire, socialism inspires but cannot deliver. Socialism's history is littered with repeated failures and human misery on a massive scale, yet it attracts smiles rather than curses from people who have never lived under it.
Peter Saunders

It makes me wonder if this is why many of my American friends like the ideas of socialism...

The first post

Hello,

My name is Ellie. I am currently studying International business and Finance at Penn State Erie, The Behrend College. I have never thought much about economics until my sophomore year, when I took honors macroeconomics and international economics courses. I discovered how fascinating economics as a field are and decided to take more courses even though I didn't need them for my major.

For Christmas 2008, my parents gave me a wonderful book called "Three Cups of Tea". I have always been aware of the third world countries and their problems, but this book opened my eyes. I realized that not many women in this world are as blessed as I am, they cannot go to school, work, and as a consequence make informed decisions about their present and future lives. I have decided to dedicate my passion for economics to the women of this world.

In the summer of 2009, I had the chance to attend a FEE seminar in Michigan. Here I was introduced in the Austrian economics movement, its theories and applications in today's world. I come from the Czech Republic, a country where only 20 or so years ago, ideas of free market were forbidden and laughed at by the government, yet many of those suffering under the communist regime were longing for it every day. This is why I decided to dedicate my passion for economics to economic freedom.

Combine economic freedom and women and you get the topics of my current research: Advancement of Women via Foreign Direct Investment, and also Freedom in the World and the Glass Ceiling for Women.

In my near future, I want to apply to graduate school, learn more about international and development economics and apply what I learn to more research in the areas of economic freedom and the lives of women around the world. I wish that one day, I could advise governments of those countries where women suffer; I wish that these governments were doing things better and that one day, women had the same freedom to choose for themselves as men have today.