I read a nice article on men's shorter lifespan, as compared to women's. It appears here.
In a nutshell, men are wired for competition, and women are wired for longevity. There are interesting points made about our behavioral differences and how they bring our average down: men are more likely to die driving drunk, women spend 50% more on healthcare, women are better consumers of healthcare information, and those are just a few examples.
The article also points to a new ad campaign promoting men paying more attention to preventative medicine, and health management in general. It's a lighthearted pitch called "Real Men Wear Gowns", and it can be found here (http://www.ahrq.gov/realmen/).
So if you're a man who's reading this, and living a shorter life than women do seems unfair to you, then do something about it! If nothing else, share the link with other men, that is, if you're man enough to.
Tuesday, February 17, 2009
Tuesday, February 10, 2009
A Flashback to the Future
Lately, when I read or listen to news sources, it's hard not to come across someone saying "Wall Street is dead as we know it", or words to that effect. A quick Google of the phrase "the end of wall street" yields over 48.5 million hits. Clearly, the concept is on a lot of people's minds.
I can't help but think back to last summer, when our collective attention was focused on one thing: gasoline prices. When a gallon of regular unleaded exceeded $4.00, there were many smart, well-paid, people predicting that $7.00/gallon gasoline was soon to be a reality, and a barrel of crude oil on the futures market would cost over $200.
Ostensibly wise, reasonable people made the assertion "the days of $2.00-a-gallon gasoline are over". It was so unthinkable that gasoline would be affordable again that this was a slam-dunk, no-brainer statement. You need only look at your local gas station to see proof of how something so clear and obvious at the time can quickly become irrelevant.
So I'm not sure why Wall Street was surprised when Geithner announced the details around the next phase of the TARP, and dumped mainly financial stocks to the tune of a 382-point drop today. Were they really expecting a man with less than a month on the job to definitively figure out the key to unlock the downward spiral in banking and the economy?
The triumph of hope over experience, indeed.
Few people truly understand how the world's financial markets work, and those who do understand its workings appreciate a small niche of it enough to make vast sums of money for themselves. And guess what? They're not telling anyone how it works, until maybe after the fact when they dish the tell-all story.
Why do I think this? Imagine if you could accurately predict where the traffic jams were going to be tomorrow morning before your morning commute (assuming, of course, you drive to work). If only you have this information, your prediction will most likely come true: you will be the only person on a back road and you'll breeze into work effortlessly.
However, imagine if many people had this information, not just you. Would that back road be empty? No. It would have many people on it as well; all the other people who had the same information as you, and who predicted that the back road would be clear.
That would invalidate the prediction, wouldn't it? So to stay accurate, your prediction would have to be able to adapt infinitely to take into account all the other predictions being made by your fellow commuters, who also have infinitely adapting predictive information. In the end, you'd be right back where you are now: unable to say with any certainty where the uncongested road would be.
And so it goes with trying to predict market behavior, and our immediate financial future: the more people who have a glimpse into the future, the more people will adapt to it, and therefore ruin the prediction.
Here's the lesson to take away from all this: the people who do get it are placing their bets now on what's going to happen, and they're not telling anyone about it. Anyone who publicly says they know what's next, doesn't know. Like the people who shorted real estate stocks just before the bubble burst, they will be happy to tell us about it after their party's over.
I can't help but think back to last summer, when our collective attention was focused on one thing: gasoline prices. When a gallon of regular unleaded exceeded $4.00, there were many smart, well-paid, people predicting that $7.00/gallon gasoline was soon to be a reality, and a barrel of crude oil on the futures market would cost over $200.
Ostensibly wise, reasonable people made the assertion "the days of $2.00-a-gallon gasoline are over". It was so unthinkable that gasoline would be affordable again that this was a slam-dunk, no-brainer statement. You need only look at your local gas station to see proof of how something so clear and obvious at the time can quickly become irrelevant.
So I'm not sure why Wall Street was surprised when Geithner announced the details around the next phase of the TARP, and dumped mainly financial stocks to the tune of a 382-point drop today. Were they really expecting a man with less than a month on the job to definitively figure out the key to unlock the downward spiral in banking and the economy?
The triumph of hope over experience, indeed.
Few people truly understand how the world's financial markets work, and those who do understand its workings appreciate a small niche of it enough to make vast sums of money for themselves. And guess what? They're not telling anyone how it works, until maybe after the fact when they dish the tell-all story.
Why do I think this? Imagine if you could accurately predict where the traffic jams were going to be tomorrow morning before your morning commute (assuming, of course, you drive to work). If only you have this information, your prediction will most likely come true: you will be the only person on a back road and you'll breeze into work effortlessly.
However, imagine if many people had this information, not just you. Would that back road be empty? No. It would have many people on it as well; all the other people who had the same information as you, and who predicted that the back road would be clear.
That would invalidate the prediction, wouldn't it? So to stay accurate, your prediction would have to be able to adapt infinitely to take into account all the other predictions being made by your fellow commuters, who also have infinitely adapting predictive information. In the end, you'd be right back where you are now: unable to say with any certainty where the uncongested road would be.
And so it goes with trying to predict market behavior, and our immediate financial future: the more people who have a glimpse into the future, the more people will adapt to it, and therefore ruin the prediction.
Here's the lesson to take away from all this: the people who do get it are placing their bets now on what's going to happen, and they're not telling anyone about it. Anyone who publicly says they know what's next, doesn't know. Like the people who shorted real estate stocks just before the bubble burst, they will be happy to tell us about it after their party's over.
Thursday, February 5, 2009
Row Faster!
The Bureau of Labor Statistics has released its revised Q3 2008 productivity report. According to the report, worker productivity increased during the third quarter. Sounds like a good thing, doesn’t it?
If you look a little more closely at the numbers, you’ll realize it’s not all it seems.
Productivity is a ratio consisting of output produced to hours worked. The way we want productivity to increase is to make more output and hold hours worked constant. That would be one way to improve the ratio.
The other way to improve this (or any) ratio is to decrease the denominator, which is exactly what’s happened in the latest productivity increase: the number of hours worked by the labor force declined in Q3. This decrease is due to activities like forced furloughs and shortening of the work week to avoid layoffs.
Once again, the American worker learns to do more with less. In this case, it’s with less time to do the same amount of work. So grab and oar and row faster!
If you look a little more closely at the numbers, you’ll realize it’s not all it seems.
Productivity is a ratio consisting of output produced to hours worked. The way we want productivity to increase is to make more output and hold hours worked constant. That would be one way to improve the ratio.
The other way to improve this (or any) ratio is to decrease the denominator, which is exactly what’s happened in the latest productivity increase: the number of hours worked by the labor force declined in Q3. This decrease is due to activities like forced furloughs and shortening of the work week to avoid layoffs.
Once again, the American worker learns to do more with less. In this case, it’s with less time to do the same amount of work. So grab and oar and row faster!
Wednesday, February 4, 2009
See For Yourself Just What’s In The Senate's Stimulus Bill
If you were wondering what’s in the stimulus package that’s being put together by the U.S. Senate, I found a concise breakdown of the allocations from the Congressional Budget Office (CBO) here.
Unlike the full text of the bill, this is an easily skimmable 25 pages. If you’re wondering what’s in it, take a look.
When you’re looking at the dollar amounts that the different industries and interests are lined up to receive, something to keep in mind is that there’s no guarantee that all the money being requested in the bill will actually ever be spent. It’s like a giant line of credit.
Case in point: there are sometimes clauses in the specific grants mandating that States match some proportion of the federal funds they wish to receive. For example, in the Health Information Technology section of the Senate’s bill in section 3013, subsection (i) there’s a clause that says:
(i) Required Match-
(1) IN GENERAL- For a fiscal year (beginning with fiscal year 2011), the Secretary may not make a grant under subsection (a) to a State unless the State agrees to make available non-Federal contributions (which may include in-kind contributions) toward the costs of a grant awarded under subsection (a)(3) in an amount equal to—
(A) for fiscal year 2011, not less than $1 for each $10 of Federal funds provided under the grant;
(B) for fiscal year 2012, not less than $1 for each $7 of Federal funds provided under the grant; and
(C) for fiscal year 2013 and each subsequent fiscal year, not less than $1 for each $3 of Federal funds provided under the grant.
So, while the funds have been pledged, if a state cannot come up with their match, then the federal money will not be disbursed.
Gee, I wonder how a State could raise $20 million it didn’t have in its budget previously...
Unlike the full text of the bill, this is an easily skimmable 25 pages. If you’re wondering what’s in it, take a look.
When you’re looking at the dollar amounts that the different industries and interests are lined up to receive, something to keep in mind is that there’s no guarantee that all the money being requested in the bill will actually ever be spent. It’s like a giant line of credit.
Case in point: there are sometimes clauses in the specific grants mandating that States match some proportion of the federal funds they wish to receive. For example, in the Health Information Technology section of the Senate’s bill in section 3013, subsection (i) there’s a clause that says:
(i) Required Match-
(1) IN GENERAL- For a fiscal year (beginning with fiscal year 2011), the Secretary may not make a grant under subsection (a) to a State unless the State agrees to make available non-Federal contributions (which may include in-kind contributions) toward the costs of a grant awarded under subsection (a)(3) in an amount equal to—
(A) for fiscal year 2011, not less than $1 for each $10 of Federal funds provided under the grant;
(B) for fiscal year 2012, not less than $1 for each $7 of Federal funds provided under the grant; and
(C) for fiscal year 2013 and each subsequent fiscal year, not less than $1 for each $3 of Federal funds provided under the grant.
So, while the funds have been pledged, if a state cannot come up with their match, then the federal money will not be disbursed.
Gee, I wonder how a State could raise $20 million it didn’t have in its budget previously...
Tuesday, February 3, 2009
The Savings Ripple Effect
Many people have bemoaned the average American's low rate of savings. "We spend too much and save too little" to paraphrase the critics, and so news that Americans are spending less and saving more, likely because of job uncertainty, is sure to please some.
Here's an interesting potential ripple effect of that increased savings rate: the price of crude oil futures will continue to decline despite an increase in American consumption of refined petroleum products such as gasoline. Here's why...
American consumers were relied on for a long time to buy goods made in other countries, most notably China. As the WSJ reported yesterday, an estimated 20 million workers lost their jobs in China. With Chinese factories not producing as much, they are consuming fewer petroleum products (e.g., less fuel for factory machines, less oil for plastics) and so global demand will decline. When demand declines, so do prices.
So maybe there's unexpected good news to be had when Americans save more?
Here's an interesting potential ripple effect of that increased savings rate: the price of crude oil futures will continue to decline despite an increase in American consumption of refined petroleum products such as gasoline. Here's why...
American consumers were relied on for a long time to buy goods made in other countries, most notably China. As the WSJ reported yesterday, an estimated 20 million workers lost their jobs in China. With Chinese factories not producing as much, they are consuming fewer petroleum products (e.g., less fuel for factory machines, less oil for plastics) and so global demand will decline. When demand declines, so do prices.
So maybe there's unexpected good news to be had when Americans save more?
Monday, February 2, 2009
A Glimpse of More Economic Pain to Come
I was looking at some just-released (2/2/2009) leading economic indicators, and sure enough, construction spending is declining across most industries. This is not a surprise. Also not surprising is the slow but steady increase in spending in certain segments: healthcare, public safety, and sewage and waste disposal.
The result that suggests that there's more pain to come was this: manufacturing construction was consistantly increasing over the last four months of 2008. Since manufacturing construction projects tend to be highly capital-intensive, are sometimes scheduled years in advance, and are often more than a year in their completion, this means we're still expanding our structural capacity to produce products in a time of recession and declining consumer and corporate spending. This is not a good thing.
Couple this with the recent news of increasing inventories, and we may be due for even more layoffs and more contractions in corporate spending in the near future, as the supply of products and the infrastructure to make them continues to diverge from the demand for those products and the demand for manufacturing capacity.
The result that suggests that there's more pain to come was this: manufacturing construction was consistantly increasing over the last four months of 2008. Since manufacturing construction projects tend to be highly capital-intensive, are sometimes scheduled years in advance, and are often more than a year in their completion, this means we're still expanding our structural capacity to produce products in a time of recession and declining consumer and corporate spending. This is not a good thing.
Couple this with the recent news of increasing inventories, and we may be due for even more layoffs and more contractions in corporate spending in the near future, as the supply of products and the infrastructure to make them continues to diverge from the demand for those products and the demand for manufacturing capacity.
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