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Here are the current top three stories in the NY Times Business Section as of 9:30pm ET, July 28th:

While checking out the headlines this morning, I ran across this from David Brooks at the NY Times.  Anyone at or approaching middle age should check it out, because it’s a humorous take on memory loss and information overload.

Here’s his take on the start of a conversation: 

This divide produces moments of social combat. Some vaguely familiar person will come up to you in the supermarket. “Stan, it’s so nice to see you!” The smug memory dropper can smell your nominal aphasia and is going to keep first-naming you until you are crushed into submission.

Your response here is critical. You want to open up with an effusive burst of insincere emotional warmth: “Hey!” You’re practically exploding with feigned ecstasy. “Wonderful to see you too! How is everything?” All the while, you are frantically whirring through your memory banks trying to anchor this person in some time and context.

A decent human being would sense your distress and give you some lagniappe of information — a mention of the church picnic you both attended, the parents’ association at school, the fact that the two of you were formerly married. But the Proustian bully will give you nothing. “I’m good. And you?” It’s like trying to get an arms control concession out of Leonid Brezhnev.

Good stuff!  At least it was funny when I read it - I forgot why…. 

gk

Wow, I know the NY times is not a fan of deregulation (in any form) but they’re piling on in the past few days.  Check out this editorial calling for more federal regulation on credit cards.

As an example of why more regulation is needed, they provide an anecdote of a stupid man in Chicago.  Here’s a quote:

At a recent news briefing in Washington, a Chicago man told about what happened when he charged a $12,000 home repair bill in 2000 on a card with an introductory interest rate of 4.25 percent. Despite his steady, on-time payments, the rate is now nearly 25 percent. And despite paying at least $15,360, he said that he had only paid off about $800 of his original debt.

Despite paying at least $15,360, he’s only paid about $800 of the principal?   The only way this is possible is if he’s been paying the minimum for the past 8 years.  If that’s what he’s done, he’s a moron! 

I suppose we should look to the government to bail him out too? 

I ran across an interesting article in the NY Times today.  Gail Collins obviously believes in cradle to grave socialism, but she writes well. 

She sarcastically lambasts McCain for wanting the current crop of hustlers to fail on their own, and she doesn’t seem to understand the consequences of what she’s advocating.  If people (and companies) are bailed out for their bad choices, they will continue to make bad choices.  Even worse, others will be encouraged to make bad choices, thus compounding the problem in the future when more people need help.

This is no different than Medicare/Medicaid, food stamps, subsidized housing, welfare, etc.  Let people fail - and let them bear the consequences of their failures - and they improve their decisions in the future.  Bail them out and they’ll continue to need help forever.

gk

Paul Krugman has a decent opinion piece in the NY Times today.  If you’ve read any of his stuff before, you know that he thinks government has all the answers - and that government can fix whatever is wrong with (pick your topic!).

Todays’ article basically blames everything economic on “A Crisis of Faith”.  He says that investors have lost faith in the security of the underlying investments, and their lack of faith is causing the Port Authority’s borrowing cost to go up.  Technically that’s true, but he doesn’t go deep enough into “why” investors don’t have faith.

It’s not that they distrust the Port Authority ability to raise taxes to pay them back - it’s that the insurers are technically bankrupt - IF the Port Authority doesn’t pay the money back, there’s no second layer of protection.  It’s the same as if you were thinking about putting your money into a bank that has a great reputation but isn’t FDIC insured.  If you can get the same return on your investment from an FDIC insured bank - why would you bother with the non-insured bank?

When Ambac and MBIA are technically bankrupt, why bother with anything they insure?  There are safer places to put your money.  Not necessarily big FDIC insured banks - sure you’ll get your money back if the bank fails, but it may take quite a while.  Local banks that didn’t resell the mortgages they wrote should be fine - they were conservative in writing the loans, so they won’t be hit as hard when a lot of people default over the next couple of years - but I think gold and/or silver will have better returns than most other common investment over the next 1 to 2 years.  This financial crisis is just getting started.

gk