It’s good news that Tim Geithner is throwing his weight behind efforts to build a US market in covered bonds. This made sense back in 2008, when I did my best to explain what exactly covered bonds are, and it makes sense today as well. The more different ways that mortgages can be funded, the less pressure there is on the US government and government-owned agencies like Fannie Mae and Freddie Mac to fund just about everything.
My first monthly Gastronomics column is up at NYMag, on the subject of the economics of bad service. Why are restaurants which do the best job of maximizing discomfort, inconvenience, and noise also the ones which are the most popular? My theory is that it’s all about signaling: that if restaurants succeed at manufacturing crowds and long waits, people reckon that the place must be good, otherwise everybody else would never put up with such things. And so they become self-fulfilling.