Conversations with My Students

I teach a Macroeconomics class on Saturday mornings that has a very international group of students. And it is amazing the questions that they ask.

A few weeks ago I put the class on teams for a little stock market game that will run during the course of the semester. After class, Helen, who comes from Ethiopia approached and asked me what a stock market was. Now, I had not taught the part of the class yet about how our financial system works, but the other students were at least aware that something called a stock market exists, and stocks of companies are on it and go up and down. Helen had never heard of such a thing. I explained it a little and gave her some guidance to learn more on the internet. The following week she told me she discovered there is a stock market in Ethiopia, but only a few companies are listed.

Last week I was teaching about the effect of taxes on welfare (you will recall there is a “dead weight loss”). After class Mohammed, who I hadn’t talked to much, but I guessed was from somewhere in the Middle East, approached with an even more astounding question: “Why would a government ever tax anyone?” Now, I know some of my Republican friends feel the same way, but they know we do need the government to perform certain tasks, for which we pay taxes ( and, yes, we pay taxes for things they shouldn’t be doing, but no one ever agrees on how to stop that!). But Mohammed has recently arrived in the US from Saudi Arabia, where there are no taxes. Why? Because their government raises all the money they need from Americans filling our big cars with gas made from their oil. Mohammed had never heard of taxes, because we pay his taxes for him

So, think about Saudi Arabia: No taxes, conservative religious nuts and the oil industry completely in charge. No wonder Bush is always holding hands with those guys!

By the way, this class also has a girl from S. Korea, and a guy from Nepal. This is one of the things that makes teaching fun. I get to learn from my foreign students.

Finally, I took my bike into the shop yesterday, where I saw a former student of mine who is now at CU. I asked what he was majoring, and he said “Eco”. I said I hoped I was not responsible for that. He said that there is a lot more math involved than I lead him to believe. Oh well, the world can never have too many dismal scientists!

Success in Cuba!!!!

After only 49 years, our economic sanctions on Cuba have finally brought Castro down. This proves what a great policy we've had regarding Cuba for all these years. I'm sure the Bushies will claim that their “get tough” policies regarding Cuba caused Fidel's illness.

Let's look at the how we treated various Communist countries, and what happened. We engaged the Soviets, and communism crumbled. Nixon went to Chnia, and ....well, the Communist Party still runs the place, but it's hardly “communist” anymore. We lost a war in Vietnam, but now we trade freely with them, and they are much like China. Meanwhile, we isolate Castro, and he outlives everyone who came up with the strategy in the first place. Iran is not Communist, but isolating them is only making the Ayatollah and his crazy friend stronger.

What have we learned? Not much! But what we should have learned is that economic sanctions won't bring down a dictator. By denying resources to Cuba, we've made the public there too poor to rally against Castro, and given him an evil empire to rally the people against. We aren't denying Castro resources, we are denying the average Cuban.

The way to get rid of this regime is to do exactly the opposite of what we have been doing. Encourage trade and tourism to Cuba. Put a major league baseball team in Havana. With that much US cash floating around, Communism is bound to tumble as markets will develop that they can't stop.

I may be wrong, but it can't be any dumber than 50 years of futile isolation.

How I used a baseball cap to start a dead car.

Friday I went skiing at Keystone on a beautiful day with my neighbor Cathy. Cathy, who is a free-lance writer, drove because she had to leave the sun-drenched slopes in the middle of the day to participate in a conference call with some clients, which she did while sitting in her car.. During her call, she had the ignition on, and I'm guessing the lights as well.

I was wearing my Buffalo Sabers baseball cap that day, and when we were enjoying the best part of skiing.....changing out of the boots back into comfy shoes....the guy in the jeep next to us saw my hat and asked if I was from Buffalo. He was from West Seneca, and we talked hockey a bit, as Buffalonians tend to do.

When Cathy turns the key to start the car, she gets nothing but a clicking noise. “That doesn't sound good” she says.

Having survived my lean years in Buffalo with a series of horrible cars, I knew the sound immediately. “Your battery is dead”.

“Really?”

“Oh yeah, but don't worry, I know what to do”.

I jumped out of the car and shouted to my homeboy “Hey, do you have jumper cables. Our battery is dead”, knowing full well that a dude from Bufalo would certainly have jumper cables..

A few minutes later we were on our way, with the help of a friendly former Buffalonian. Cathy, who grew up in New Jersey, was amazed. I pointed out to her that this is what we learn growing up in Buffalo. You're prepared for bad stuff to happen, and when it happens to someone else, you help them, and ask nothing in return. If you see a stranger stuck in the snow, you push them out, knowing the same courtesy will be extended to you when you need it. And yes, I have jumper cables in my car too.

I love living in Boulder, and wouldn't move back to Buffalo for anything, but I'm proud to be from Buffalo, in part because of the values I learned there.

Go Sabres!

Thank the Senate for saving our sports!

Really, does the Senate need to be wasting it's time holding hearing on steroids in baseball. Okay, maybe you could say a criminal conspiracy existed in baseball as owners and the commish turned a blind eye to roid induced HR's because it boosted the bottom line. But is this what we elect these guys for?

Far sillier is Arlen Specter's concern about the Patriots taping other teams, and destroying the tapes. Really Sen. Specter, you are going to waste the taxpayer's money on this because the Pats beat the Eagles in the Super Bowl.

On a more intelligent note, check out the discussions of Roger Clemens career stats on the Sports Economist. ( see link to right). Very interesting stuff.

Just a few thoughts.....

It looks like the writer's strike will end tomorrow, just in time for the comedy writers to have missed all the best Presidential candidates, at least from their perspective. Romney, Kucinich, Guliani.....these guys where a writer's dream. Obama and McCain don't bring much easy comedy material, which is why I'm sure John Stewart is going to be pretty happy when his writers come back to work. Of course, where there is Hillary there is also Bill, the greatest President in US history from a comedy writer's perspective (and to think I voted for Perot in 92 because I thought he would provide the most laughs!).

Meanwhile, at Tradesports.com Obama is now trading at a 70% certainty of getting the nomination, up 23 points since before Super Tue, and 16 from last Wed. So if McCain and Obama become the nominees, what is America saying? I think we are saying we are sick of the hate-filled, divisive, Bush v Clinton politics. That we want our politicians to work together to solve problems, not to politicize things that are just too important. We want solutions, not more bullshit. And for my Republican friends, they appear to be saying that Rush and Colter and the other blabbering idiots have lost their influence. I think this is a good sign. And it is now certain that our next President will be a vast......is there a bigger word than "vast" I should use here.....improvement over Idiot Boy Bush.

Finally, and not relating to politics at all, it looks like Richard Zednick will fully recover from a life threatening gash to his throat suffered the other night in Buffalo. Oddly, the last time this happened in the NHL was also in Buffalo in 1989. My good friend Budd Bailey was working for the Sabres PR department that night, and you can read about his experience the night that Clint Malarchuk's throat was slashed by a skate here . A story in today's Denver Post has Jacques Cloutier, currently and Avs assistant coach, saying his knees where shaking when he replaced Malarchuk in the nets after they scraped up all the blood. Imagine the coach turning to you and saying "Go in there and replace that guy who might be dead. And don't let in any goals!"

Post-Primary Gras Prices

The other day, after reading a post on The Sports Economist about the site, I started watching the prices on Tradesports.com for Presidential candidates. This is a site where you can bet on the outcome of sporting events, weather, politics and other events (even a US recession) by trading futures. If the market sees something as more likely, the price goes up.

In a nutshell, after Primary Gras, McCain is now nearly a lock to win the Republican nomination, while the gap in prices between Hillary and Obama narrowed a few points since Monday. The market is saying that the Republican race is over, and the Dems has just gotten tighter.

This site has historically been very good at predicting outcomes like this, much better than polls. Economists love watching it because they see it as the market making predictions. And it's much more fun than listening to the blabbering pundits on TV.

By the way, Tradesports traders say there is a 70% chance of a recession this year.

I can't believe they are going to play the game!

Earl Butz is dead, and yet life goes on, and there is no talk of canceling the Super Bowl. Have we no shame!