Fannie and Freddie

We spoke about TARP in class and mentioned the issue of Fannie and Freddie (the quasi private mortgage giants). This is an excellent piece (I think it is the first piece actually). It is worth listening to (click on the "Listen to the Podcast" link)

Update I: Here is an interesting article about how the executives for Fannie and Freddie were paid millions. Tough to justify the heads of these failed organizations millions in salaries from taxpayers.

Update II: Part 2 here and Part 3 here

Please be sure to at least listen to the first one.

Instability Helping Some

The foreign turmoil (especially in the Mid East) has obviously hurt many nations. But as we learn in class, those relying on oil exports are sometimes helped by the increase in oil prices. Here is evidence of this.
If you are wondering just how much OPEC is being affected by this turmoil just take a look at the members of the organization here.

Fed to Become More Open

The Federal Reserve has always been a secretive organization. They have often argued (with justification in some cases) that with greater transparency would come less power. In other words their policies require that no one actually knows what they are doing. This makes sense in many respects. But calls for more openness have occurred as the years have gone by.

They have a branch (called the FOMC) that meets regularly to determine Monetary Policy. Once upon a time it was months before they even disclosed what was talked about in that meeting. Then they changed the rules that ended up reducing the time of disclosure. Now there are greater calls for openness (and many are asking for auditing the Fed) and it appears as if they have changed the rules once again.

The Book Industry

Technological shocks are known to alter industries. One way is when the new technology changes the way people people can make money providing the product. Take for example TV and radio. When these industries began people struggled with an economic system centered around a product that you could not exclude people from (until they mastered the art of marketing). This is going on today in the journalism industry as well as the book industry. This is an excellent example of the industry trying to change to keep up with technology shocks. These issues are excellent ones for position papers as well.

Game Theory in the NBA

We can use Game Theory in just about anything. This is a great example of it being used in the NBA.

NFL Labor Fight

For you sports fans, there is a fight starting between the NFL and the NFL PA (NFL Players Association). This is a win for the NFLPA.

The NFL and NFLPA have an agreement that when the NFL negotiates TV contracts it has to try to get the best deal it can. This is relevant to the NFLPA because they share some of the revenue. But the NFL knew there was a new Collective Bargaining Agreement (CBA) that was going to be negotiated between the NFL and NFLPA. They wanted to do what the NBA did, which was get a TV contract that guaranteed them revenue even if there was a lockout (the owners don’t allow the players to play) or a strike (the players decide not to play). To get this they had to sacrifice funds that the NFLPA was apparently entitled to. At least that is what the judge ruled. To quote from the article:

In his 28-page ruling, Doty criticized special master Stephen Burbank for legal errors and erroneously concluding earlier this month that the NFL can act like a self-interested conglomerate when in fact it is bound by legal agreements to make deals that benefit both league and player.

Doty instead declared that the NFL violated its agreement with the union, which had asked that the TV money be placed in escrow until the end of any lockout. A hearing, yet to be scheduled, will be held to determine potential damages for the players as well as an injunction involving the TV contracts.

I have not had enough time to read up on the issue but my initial thoughts are that the NBA was able to do this, so why not the NFL. They both share very similar legal standings in that they both have limited Anti-Trust exemptions. Very curious.

Future of Education

There is plenty of uncertainty associated with the future subsidizing of education by the Federal Government. This is apparent in the fight in states fighting with their teacher unions. Two good opinion pieces (good for perceptive, not so good for citations on position papers) are found in the NY times. The first by the left leaning Paul Krugman. The second by right leaning David Brooks.