Tuesday, March 31, 2009


From Reason. Good for some chuckles, but not much else:
What would happen if Uncle Sam applied for a loan at his local bank?” What sort of deal could he expect to get on a 30-year, fixed-rate mortgage?
The final credit score was an unimpressive 645, or “fair.” The authors’ conclusion: “If Uncle Sam wanted to buy a house, he would get a rate of 7.836% for a 30 Year Fixed rate.” That technically “would put the United States in the subprime category.”

You may have noticed Newfoundland recently abolished interest on student loans; I know a fourth year who just diverted a scholarship from loan repayment towards entertainment purposes on the basis of the decision.

I'm trying to formulate an idea on the equity premium puzzle (or lack thereof, now that long-term bonds performed as well as equities over the last fifty years, though that won't stick, I hope) and the option value of being able to leave the market at any time, but I can't piece the strings together and don't have the time to poke through the literature. I'll write that down for summer.

The flyout went well. Nine people showed up, one more than last year, giving the students a chance to consume wings and beer on the department's dime. What else can one ask for?

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