Saturday , June 6 2020
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The author John H. Cochrane
John H. Cochrane
In real life I'm a Senior Fellow of the Hoover Institution at Stanford. I was formerly a professor at the University of Chicago Booth School of Business. I'm also an adjunct scholar of the Cato Institute. I'm not really grumpy by the way!

John Cochrane – Grumpy Economist

John Cochrane, Senior Fellow of the Hoover Institution at Stanford, is The Grumpy Economist. But he claims to not actually be grumpy. On this blog, he provides detailed commentary backed with data and exceptional reasoning on current economic news, finance and policy policy.

Unemployment insurance weaning

As the economy recovers, public policy faces an inevitable dilemma. How do we wean the economy from support?This comes to the head with federal support for unemployment insurance -- $600 per week, set to expire at the end of July. The unemployment rate will still be high in July. Congress seems to have largely given up, in public, of thinking clearly about the economic purpose of policies, and now the discussion is entirely in terms of who deserves additional "help," often in moral terms --...

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Airlines and information

Airlines are in big trouble. Even after reopening, nobody wants to fly, perceiving them as dangerous.But are airline flights dangerous? As I read the super-spreading literature, I have not seen a single case of an airline flight charged with spreading the virus. (Please chime in if you have seen any documented cases of virus spread on airline flights.) That's remarkable. From January to March, people were flying all over the world. People were flying from Wuhan to all over the world. But...

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Jones and Fernández-Villaverde update

Chad Jones and Jesús Fernández-Villaverde have updated their SIR model with social distancing. A part I find very intriguing is that they impute the infection rate and the reproduction rate from death rate data. The infection rate (I_t)  is given by [I_t = frac{1}{delta gamma} left( frac{d_{t+2}-d_{t+1}}{theta} - d_{t+1} right)] where the greek letters are parameters they estimate by fitting the path of deaths over time, and (d_t) is the daily death rate. Though deaths only happen a few...

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Get Ready for the Careful Economy

Source: Wall Street JournalReady or not—mostly not—the reopening is at hand. The economic carnage of a continued lockdown is simply too great to sustain. But the virus is still with us, so the carefully reopened economy will be less efficient than the pre-pandemic economy.....A Wall Street Journal Oped on where we are and peering in to the muck. Much is inspired by my "dumb reopening" blog post of a week or so ago.I must say my faith in human wisdom is a bit shaken by the videos of massive...

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School of sustainability

In a few recent posts, I was critical of university endowment practices. Why build up a stock of investment, rather than invest in faculty, research, or other core activities? Why wall that pile of assets from being spent, especially when budgets are cratering in a pandemic? When we see businesses with piles of cash, we infer they don't have any good investment projects, and the piles are ripe for diversion to bad ideas.But universities are non-profits, and one major piece of being a...

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Endowment humor

Steven Wood writes a wonderful letter from a university president, responding to suggestions that a university dip in to its endowment,As president of this University, there is nothing more important to me than the health and safety of our community. Though I’m currently away from campus, summering on my private island off of Maine, my thoughts are almost always with you, and my secretary is literally always available to field your questions and hear your concerns....a number of you have...

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Schmitz on monopoly

Jim Schmitz has released the first salvo in what promises to be a monumental work on monopoly, titled Monopolies Inflict Great Harm on Low- and Middle-Income Americans. (I love titles with answers and no colons.)Today, monopolies inflict great harm on low- and middle-income Americans. One particularly pernicious way they harm them is by sabotaging low-cost products that are substitutes for the monopoly products. I'll argue that the U.S. housing crisis, legal crisis, and oral health...

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