Feb 12 Is There a Better Term for Moral Hazard? Question: Paul, Thank you for your excellent explanation of moral hazard. I checked many other sources before I found your website and only found confusing definitions. The main problem is that the phrase “moral hazard” does not seem well… Continue reading
Feb 11 Where Does Goldman Sachs Fit in the Greek Debt Crisis? Question: An article in a recent edition of the NYT mentioned that Goldman Sachs had contracts with AIG in 2009 to insure its bearish position in the… Continue reading
Feb 10 Should We Transfer Accounts to Small Banks? Question: Isn’t the best way for “us” to give the big banks a message is to take our accounts to small banks? Is there a rating of small banks to help us make an educated choice? Paul Solman: Funny you… Continue reading
Feb 09 If EU Countries Default, How Will the U.S. Be Affected? Question: If the EU PIGS (Portugal, Ireland, Greece, Spain) default, how will this affect the United States? Paul Solman: First, it should be PIIGS. Add an “I” for… Continue reading
Feb 04 Karl Case’s (Poetic) Reflections on the Housing Market Paul Solman: We’ve been interviewing Wellesley economics professor Karl ‘Chip’ Case since the last housing crash here in Boston in the late ’80s, and as recently as a few weeks ago with his well-known collaborator Bob Shiller. Continue reading
Feb 03 Is Bankruptcy the Best Solution for California’s Budget Problems? Question: I wonder if going into bankruptcy would be the best solution for California’s budget deficit problems. Wouldn’t bankruptcy allow for the renegotiation of contracts between the state and, say, labor unions? Pensions and entitlements seem to be a huge… Continue reading
Feb 02 What Are the Indirect Costs of the Financial Meltdown and Bailouts? Question: There are endless comments in the news lately about the banks paying back “every penny” of the “costs” of the financial meltdown. In any civil proceeding that I know of, when a plaintiff asks for damages pursuant to someone’s… Continue reading
Feb 01 What Effect Will a Freeze on Discretionary Spending Have on the U.S. Economy? Question: What effect will a freeze on discretionary spending have on the U.S. economy? Paul Solman: There are two large points to be made here. One is that most of the U.S. budget is… Continue reading
Jan 28 Keynes-Hayek Rap Video Goes Viral! Non-economists Worldwide Infected! Paul Solman: Forgive the sensationalist headline, but after the pummeling we took for debuting the Keynes v. Hayek rap smackdown in December, what harm in bringin’ in more noise and funk? First came the… Continue reading
Jan 26 Home Prices Up Slightly in November Paul Solman: Case and Shiller, the economists of the fabled Standard & Poor’s/Case-Shiller Housing Index, appear together for the first time on the NewsHour Tuesday night, taking us all on a tour of Atlanta, Georgia, and its housing woes. Continue reading