George Carlin R.I.P.

It occurs to me that our fiercest social critics in America today are comedians. Today we lost our Solzhenitsyn, George Carlin. Here is my favorite bit of his from Gulf War I. It could easily apply today, by just changing the names. Wait. You don't even have to change the names ....

You Can’t Make This Stuff Up, or Can You?

I can't resist one more on the alleged Oil Bubble. This one is from Ben Stein, who I enjoy occasionally. He is one of those unrepentant ex-Nixon staffers, so there is only so much of his writing I can take seriously. And of course, he is something of a comedian to begin with. You Can’t Make This Stuff Up, or Can You?

The Oil Nonbubble

An opposing view from Paul Krugman of the New York Times. He thinks the run-up of oil from $25 a barrel to $125+ (and purportedly heading for $200 if you believe Goldman-Sachs) is all normal supply and demand: The Oil Nonbubble

Soros: Financial Crisis Stems from 'Super-Bubble'

A good audio interview with George Soros on NPR: Soros: Financial Crisis Stems from 'Super-Bubble' (7 minutes) .

Chemist Who Discovered LSD Dies at 102

I thought the good Dr. Hoffmann passed away long ago. What is less well known is that he was searching for, and found, perhaps the only cure for migranes: Chemist Who Discovered LSD Dies at 102.

Italy posts income details on web

I believe other countries (more or less) do this, but it could be interesting in Italy, where so much economic activity is under the table: Italy posts income details on web

Airline fuel bets

I have been wondering about another recent 'free market' phenomenon. We see airlines going out of business due to fuel prices. Airlines use futures to try to hedge agains changes in the price of fuel. But it has become a large and dangerous game.

Rumor has it that Southwest Airlines gets their jet fuel at prices reflecting the equivalent of $50 a barrel oil due to shrewd (or lucky) futures purchases. Other airlines were not so fortunate. These financial instruments were originally used to protect against risk, now they seem to force huge gambles. Airlines that bet the right way on fuel prices win, the ones that bet the wrong way quickly go out of business. And it is a bet, and you are forced to play (no bet is still a bet).

This is the effect of a 'free market' as it is defined today by Wall Street. But is this efficient? Or good? Should massive industries be forced to make these kinds of bets on a continuing basis? In parallel I'll note that there was a similar effect in sub-prime mortgages, though more voluntary. People won and lost billions on similar bets. Have derivatives made Wall Street less of a bank that makes investments and more of a casino that makes bets? If so, should they be taxes and regulated like casinos?