James Pethokoukis

How financial crises are like earthquakes

June 10, 2009

They both seem to follow a mathematical relationship called a “power law” where you have lots of small events trailing off into infrequent but much bigger events, according to a McKinsey study. (So don’t assume stability, look into the deep past not recent history, look for early warning signs and study complex systems. ) Now this is a great chart from the¬†McKinsey study:

Comment of the day …

June 10, 2009

I may never get a better comment than this one from my post about the $2 trillion cost of climate change legislation:

TARP repayment: Letting banks ‘slither’ away?

June 10, 2009

This gem from author and former investment banker William Cohan (via PBS NewsHour):

An improving job market? Maybe not

June 10, 2009

The below chart, highlighted by Jeffrey Frankel of RGE Monitor,¬†provides a counterpoint to the idea that the labor market is improving and employers are gearing up to hire. If they were, wouldn’t they first push their folks to work more hours?

Greens and living standards

June 10, 2009

My pal Nick Schulz comments on the political divisions between Christian Greens and Secular Greens. This bit really caught my eye:

NYTimes: In just five months, Obama almost as much to blame for deficits as Bush

June 10, 2009

Instead of running $800 billion budget surpluses — as was predicted back in the 1990s — America is running trillion dollar deficits. How did that $2 trillion swing happen? The blame breakdown, according to the NYTImes: recession, 37 percent, Bush policies (particularly tax cuts and the prescription drug benefit), 33 percent; Obama continuing Bush policies (Iraq, tax cuts) 20 percent, the Obama stimulus bill, 7 percent; and the rest of the Obama “investment agenda, 3 percent.