TMI

23 Nov 2009 03:57 pm

We're Going Broke Anyway, So Why Not Spend Like Drunken Sailors?

I don't pretend to be an economic expert, but that sounds like a good idea. Even better if phrased "We're drunken sailors, so why not go broke?"

Anyway, info & advice from one who's lived it, & somehow finds it pertinent to expanded health care:

Anyone who has dated a manic-depressive has heard some version of this argument.  "I can barely make ends meet now, so I might as well use my tax refund check to buy a boat!  After all, if I can't figure out a way to fix my budget, I'm going to go bankrupt anyway."

And anyone who has dated a manic-depressive knows where this ends.

She won't share w/ those who haven't dated bi-polar sufferers where it all ends. We're not sure if that's good or bad. This is definitely bad:

I also have no idea why anyone would think that there is no difference between going bankrupt for a huge sum, and going bankrupt for a smaller amount.  I mean, there's sometimes no difference for the debtor, but of course, there are a whole bunch of creditors who are also people, and who are not going to be paid back, some of whom may end up in bankruptcy themselves if you default.  Since in this case, many of the creditors are the American people, I would think that even the most corporation-hating, bank-despising, littleguyophilic liberal would sort of worry about this.

Is there any point in going on? [Reads the remainder. Alright, scroll-scannned the rest of it. C'mon.] No, it's something about the gov't. going bankrupt ("but of course, there are a whole bunch of creditors who are also people," See, you're going to pay for the boat your manic depressive boyfriend bought, thinking it was health insurance — she's not kidding — if this bill is passed.) because "a bunch of people are going to leave their employer health insurance under this plan for some subsidized plan--millions of them, according to the CBO." Bunches of millions of people.

Too, our new boat health care plan may have unexpected maintenance costs, as health care plans, and boats, are wont to do.  Since we've already spent our spare source of cash, and our budget has no margin for error,  our new purchase obviously places us at much greater risk of fiscal disaster.

Just as a possible bankrupt would be better off putting the cash in the bank than spending it on some new desire, we would be fiscally better off doing nothing, than we would in taking on a gargantuan new entitlement.  Yet, most of the responses to those of us who worry about the fiscal effects have so far been about the same as you get from your favorite manic depressive:  "But think how great it would be to have a BOAT!"

Should've quit while I was ahead. My sincere apology to anyone who read what little I posted. I take full responsibility.

An Addition to the Preceding Shorters: "Excellent opportunity for Rehab potential."

Must add 2¢ worth on

Real Estate Moment of the Week

as I took a look at the advert for the $1,000,000 mansion Mlle. McA. was snickering at.Yes, it's 103 yrs. old & sold for $149,000 in 1996, but is now hoped to be worth a cool million. What the hell? How can you base an economy on something like that? Have tips, wages & income increased sevenfold or whatever in the last 13 yrs.? I think not.

I'm A Moocher, Looting The Work Of Others

As no one here got to this Mega-item (I've a vague memory of scanning it, noticing that my hair was starting to hurt, & moving along) why not enjoy it from the perspective of the sort of person who is an "adult," has written books on, if not the economy, then right-wing presentation of economic issues, & gets TNR to pay him to do this sort of thing?

So McArdle's comparison -- some countries have cut taxes and thereby raised revenues, some countries have controlled costs with universal coverage -- turns out to be true if you replace the first "some" with "zero" and the second "some" with "all." Other than that, great comparison!

There does seem to be a pattern here of McArdle trying to explain away the influence of supply-siders on the conservative movement and the Republican Party. Two years ago, in response to me, she huffed that Laffer Curve devotees amounted to no more than a tiny fringe within the GOP. ("This motley collection of names is hardly proof that the Supply Siders Have Taken Over the Building.") Shortly after, in a hilarious bout of karma, McArdle had a book review spiked by a major conservative publication because, in the course of her otherwise orthodox argument, she noted that the Laffer Curve does not depict present-day tax rates in the U.S. (I would say better evidence of McArdle being wrong was the fact that the last Republican president and every GOP primary candidate in the 2008 election asserted that tax cuts could revenues to grow.)

So then, in the course of issuing a mea culpa, McArdle asserted that the same dynamic exists on the left with regard to unwillingness to criticize teachers unions. It was quickly pointed out that criticizing teachers unions is not only common but practically de rigeur among liberal columnists, magazines, think tanks, and even elected officials. So now, in her quest to show that it's not just conservatives, everybody does it, she's reaching for an even more preposterous comparison.

--Jonathan Chait

We'll scout about; perhaps Ms. McA. responded. Well, no. Not only no response, but the very next day runs an item about that ol' Laffer & his curve that makes no mention of Mr. Chait's rebuttal or takedown or vicious blog slam or whatever.

Tee Vee Eye

This, though published 12 June, was in The NYT's "e-mailed to me Opinion Section" this (I was conscious by 1100ish) a. m. Like everyone else around here, my patience w/ virtually everything of late is as short as something very, very short, & my patience w/ Our Muse is not detectable w/ an electron microscope. But when somerthing is shoved in one's face, well ...

What little I watched seemed as dense as expected from Mlle. I think we all know that, in the mind of McArdle, the most important aspect of any health care reform is that non-working parasites (investors) must not be kept from making a profit on the pain & suffering of others. And there's something to that effect here.

If you can watch the whole thing, you're a better (or at least stronger-stomached) person than I am. Which isn't saying much.

The Burr Beneath Her Mini-Cooper Upholstery

Absolutely w/ NutellaonToast on this. Bored, & unable to deal w/ econo-blogging. Saw this mess on memeorandum, & was depressed by the mere idea of dealing w/ it. (brad?)

However, working from the comments to NoT's item immediately below, & some other assumptions, I can only conclude that Ms. McArdle prefers researching the intimate details of someone's life, Michelle Malkin-style, to statistical research on econo-facts. (Especially when you can make the facts make the victim look like a perp.)

Correct me if I'm wrong, or assuming something not in evidence.

Also referring to the comments below (Being a contributing ed. has its privileges: Imagine the indignity of being forced to reply in the comments!) I thank Dillon for clearly stating my, at least, attitude:

Similarly, FMM's mission is to cause Megan to be fired with extreme prejudice, or failing that, to marginally irritate her to the point where she does some research.

Hey, what's important is that it piss off the liberalslibertarians, right?

It's Been Nice Here Too

Doesn't, however, mean I'll be going outside or anything rash like that. Alas, even w/ the opportunity to sit here for 16 or 18 hrs., the muse has been w/holding her inspiration, & I just don't care about anything recent of hers (or much else, really) anyway. One can only keep the outrage fueled for so long.

Maybe we can top off the tank tomorrow, though.

My Sentiments Exactly

Helicopter Ben fires up the engine

Will this work? Damned if I know, and I bet Bernanke doesn't either. It should work, in theory. But while in theory, theory is the same as practice, in practice, they differ. These days, more sharply every day.

Damned if I know. Just how I feel about the whole thing. But I'm not spending all my time pretending I know, or admitting I don't know over & over. I'm starting to think all economic discourse, like Jim Cramer, should be made illegal.

Good News For All!

In the finest tradition of the repressive, authoritarian right, soon The Atlantic will be in its own gated enclave.

We've also got something that a lot of you (and me!) have been wanting for a while:  registered comments.  Eventually they'll be migrating over here, too, but for now, I hope commenters will stick with the new page.

Why sure. I wouldn't want to be free to express myself, would I? I've been dying to keep some of, y'know, those people out of your comments there, Megan.

Those of you who do register, be prepared for a glut of "offers" from The Atlantic in your in-box.

We hope this doesn't mean that Megan will be forced to earn her keep by doing more econo-blogging & less pancake-blogging.

Annals of Irony

Ms. McArdle links to this site, placing herself firmly mid-scale in the world of lying around. When the heat's been turned off, & you're desperately hoping to find work before the laptop battery runs out for good, you'll want one of these things. Good place to put your money, if you're one of the lucky scores of Americans w/ two (Or even three!) nickels to rub together. 

And the Slanket pitches itself between the two, playing to young middle-class anxieties about selfishness (Slanket donates small amounts of profit to various popular charities) and productivity (the website purrs, “Call in sick at work. It’s just one day.”) It’s creature comfort for people who don’t usually indulge in creature comforts, or at least like to think they don’t. This explains why, in the wake of the Snuggie, some Slanket partisans have rebranded their product as the "Web 2.0," “hipster” alternative. Sure, QVC and in-flight catalogs, its advertisers of choice, are hardly indie media, but infomercials make strange bedfellows.

Combine this w/ Megan's attempted mockery of a QVC product & we start to wonder. Is Megan going to go the Sarah Palin route, deny even Atlantic-level intellectualism, & join the new post-consumption, simple board games around the table by the hurricane lamp, real-American know-nothings? 

W/ no economy left to speak or type of, house-hold tips on making soap from hog rendering, feeding six for the price of two & the like may be the best direction for A.I.

Blessed Relief

I'd give Mighty Megan credit for posting as late as she did yesterday (a Friday) but must offset it w/ the realization it'll be the proverbial light posting next wk., as the crush of consumption crescendos, & we're all re-united w/ family friends.

Fine by me. No vague point, then no counterpoint. No ur-trolling needed. Stay away until mid-January, Ms. McA., then come back & tell us how your mother's retirement fund has been wiped out & she'll be staying w/ you for...Or not. Why wish ill on anyone at this time of festive cheer?


On a personal note, a digital telebision set has been installed in my motel room, so I'll be devoting a lot of time to examining the scores of extra infomercial channels that this modern techno-wonder has brought us, & bringing you a post-holiday (It's not "Christmas," damnit!) sales gift list, a la Megan. (Like hell!)

And if Megan (or anyone else) doesn't cause any more trouble, I may not have to open the laptop & register my displeasure for a while, so, w/ fingers crossed for more off-time, we wish all a cheerful "Bah! Humbug!!" & Solstice Greetings. The days are getting longer.

Way to Think, Megan

25 Nov 2008 12:15 pm

Another way to think about Paulson

A friend IM's:  "For all those salivating at the thought of a second New Deal, this is what 'bold, persistent experimentation' looks like -- kinda  messy."  Indeed.  My question:  will consumer confidence be bolstered more by confident persistence (possibly in the wrong direction), or by a hypermanic government that seems willing to try anything?  Or will neither work, and we're simply hosed?

Hosed is much too mild a word. I suppose that usage means the only standards left at The Atlantic are FCC standards. 

As I'm so far off the grid, underground, etc., your whole "economy" thing has little or no effect on me, & I haven't been paying the closest attention to capitalism's latest ("It's a natural, boom & bust business cycle") atrocity, but it seems to me that Ms. McArdle is no farther out at sea than any other half-baked pundit/talking point retyper w/ this one. It's pretty much reduced to "Nothing like this ... ever before ... duh!" & at that point it degenerates into econ groupiedom, as evidenced here.

25 Nov 2008 12:27 pm

Deep bench?

I have to disagree with Ezra Klein:  Obama's got a much, much better economics team than Bush started out with.  I agree with his endorsement of Glenn Hubbard.  But Paul O'Neill wasn't exactly an a-lister even before he turned out to have fantastic(ally entertaining!) verbal impulse control problems.  And Larry Lindsay did not match up to Larry Summers in stature, though of course what he got fired for was not being incompetent, but telling the truth.  Bush's second term team has actually been pretty stellar, but his first term left a lot to be desired.  Unfortunately, Bush's second term team--and the incoming Obama team--have had a lot higher hurdles to jump.

In real life sports analogies, there's generally a record involved. This being an entirely new, world-wide situation, everybody's a rookie. 

But if the real issues for McArdle are bolstering consumer & market confidence (in order to get started on another boom & bust cycle) why don't any of these fucks stop to consider that a house of cards, backed by absolutely nothing, finally & completely dependent on such human emotions as greed, fear, hate, pain, rage, resentment & so forth is as stupid an idea as has been concieved by any alleged science short of Mengele's experiments on human beings.

Obviously, She's Still Sick

She must be delusional from fever. There is no other plausible reason for her to actually title a post "2-4-6-8! Time to overregulate!" The second line of the poem, is of course, "and now I'll go regurgitate!"

This poetically titled word-turd is about government regulation, so you know that it will be fun. Let's see where she starts:

Freddie has a typically thoughtful post on financial regulation:

Freddie, as you may know, got his start as a commenter on MM's blog. Now, for the second time, she's all like "look at my baby!" Proud parents can relate.

While Freddie may or may not be "typically thoughtful" by pointing out that greedy people will do anything for money (no really, that's what was so thoughtful), Megan's thoughtfulness is, amazingly, even shallower. To wit:

As libertarians go, I'm relatively in favor of financial regulation. But I think there are two ways to think about financial regulation:

Right, that's because she's NOT, I repeat, NOT AT FUCKING ALL NOT EVEN A FUCKING TINY BIT a libertarian. She's a ridiculous conservative hack that is too chickenshit to admit that she's a conservative, and so instead calls herself a "libertarian" while backing all conservative positions and criticizing liberals no matter how right they turn out to be (see previous post). So, with that out of the way, let's take a look at the exactly TWO ways... two ways.... two fucking ways! She thinks there are only TWO FUCKING WAYS to regulate. How can she write that thought down and not fucking start bleeding from her ears as her brain wilts into a pool of soggy dog shit? This idiotic woman actually wants to boil down a concept as broad as "regulation" into TWO fucking things. I swear, this women has the most binary grasp on the world EVER. She fucking HEARS in black and white.

1) Wall Street people are tricky bastards who spend almost all of their time thinking of how they can best maximize their profits by screwing The Little People.

Yes, that's right, liberals dehumanize everyone. That is not at all, BTW, Megan dehumanizing liberals. It's just true true fact. I'm not even going to quote the fleshing out of this tremendously idiotic stance because the stupid is already raising my blood pressure, so let's get right to number 2:

2) There are multiple possible equilibria in financial markets, and one of the problems in those markets is that decisions which are individually highly rational can, in aggregate, move society to one of the bad equilibria. Worse, those decisions may be sticky--it may be much harder to get out of the bad equilibria than into them. The government should act to mitigate the systemic risks by doing the things that only it can do: enforce transparency, solve collective action problems, and analyze the system for systemic rather than local risk. This will necessarily involve sacrificing some potential upside in order to insure against catastrophic downsides. But the government must remain aware of its own tendency to be excessively risk averse, because regulators are punished for visible failures, but not invisible lost benefits. It must also worry about the way that the very regulations intended to ensure safety can create or enhance systemic risk, as has happened in this crisis with rules such as the mark-to-market rule, and various institutional requirements for high credit quality in investments.

Blah blah jargon blah bullshit blah, so basically the two avenues are either "You're a stupid, shallow, knee-jerk liberal that hates anyone who make money" or "You agree entirely with Megan and are therefor wise, and good looking, and totally modest." Gee, which would you choose?

Yup, I'd rather be a stupid knee jerk liberal than anything resembling Megan McArdle, too. PLAN A WINS AGAIN!

Needless to say, I think the second approach is better. Unfortunately, in crises like this, the general political attitude is closer to the first one.

OMG why, oh WHY won't she SHUT THE FUCK UP? I'm putting her back in her cage. "Needless to say, I prefer the one that I painted in bright, rosy, smarty pants colors to the one in which I dogmatically attack my opponents and accuse them of dogmatism!" WHO THE FUCK WOULD'VE THUNK?!!?!??! THANKS FOR THE POST, MEGADOODLE!

Moreover, it seems to me that at least some of the people who are tremendously excited about the prospect of regulation are not excited because they are worried about the health of the financial system so much as they are intoxicated by the power that greater regulatory authority might give a liberal government to advance other goals, such as redirecting capital flows to more "deserving" uses, or reducing income inequality.

Hmm, and it seems that at least some libertarians are pedophiles, rapists, and murders SO THEREFORE MEGAN MCARDLE IS TOO! OMG, HOW COULD SHE RAPE SMALL CHILDREN AND THEN MURDER THEM?!!?!?!?!?!!?!?! And note how she basically says it's terribly horrible for liberals to take this latest power grab to do things like give money to poor people, ignoring that the latest conservative power grab was used to bomb the brownies, keep the gays from marrying, increase income inequality, etc etc. It's almost as if she's a one sided shill for pack of soulless, greedy, assholes who are, don't forget, raping and killing children.

I think this is a very good time to strip down our regulatory system to its bare bones and rebuild it into something more effective: streamlining regulatory authority, refocusing it on systemic risk and giving it the power to pursue those issues more effectively, purging the overreliance on single models that make things more convenient for the regulators, and figuring out how the hell Basel II went so deadly wrong.

I think now would be a very good time for Megan to tell me WHAT THE FUCK BASEL II IS!

But I do not think that this is anything close to what we will actually get. We will get piecemeal patches designed to prevent the problems that just occurred without much attention to future issues (see, Enron and mark-to-market accounting). We will probably see restrictions on various types of activity, without regard to lost upside from that activity. There may well be some dramatic and pointless gesture, such as Glass-Steagall's drive to split off investment banking from commercial banking. I expect some populist measures like letting judges rewrite mortgages in bankruptcy, which look swell until the cost of a mortgage goes up.

Omg, preventing the same economic collapse from happening again!? Keeping your money safe and making investments transparent?!?!?!? Judges letting people keep their houes?!?!?!?!?!?!?!!?!! CATS AND DOGS LIVING IN HARMONY!!!!!!!! THE LIBERALS ARE ON THE LOOOOOOOOOSEEEEEE!!!!!! AHHHHH!!!!!!!!

This will make happy those who are definitionally in favor of more regulation.

What kind of person is definitionally [sic] in favor of more regulation? Are there people that just get a boner every time the government tells them what to do? Megan thinks that people are just like "Yeah! More laws! I'm so happy for economic catastrophe because now I get to follow more laws!" How can she not see that THESE ARE THE EXACT FUCKING CATASTROPHES THAT MAKE US WANT A PRO-FUCKING-ACTIVE GOVERNMENT TO BE-FUCKING-GIN WITH?!?!!?!

I think this metaphor perfectly describes McBinary's view of the world; People are cold, so they start a fire. Then it's nice and warm. Some people are like "Awesome, we're warm. Let's save some firewood and keep this fire going nice and toasty forever" and then others, let's call them, I dunno, flibberglarians, they go "No way! This fire is great so a bigger one is better! Let's throw everything on there! Our food! Our houses! Yeah! Fire is awesome!" Afterwards ,that flibberglarian looks around at all their possessions all burned up and blames the people who aren't retarded and accuses them of hating fire all along.

A lot of people writing today seem to think of regulatory agencies as quasi-prisons for Demon Finance, and think that the main problem with the current system is that it's mollycoddling the inmates. Bankers are not criminals.

I'm sorry, WHAT? Does that make sense to anyone? Is that even remotely true? Is she talking about the little gremlins that live under her bed or something? She really feels the need to tell us that "Bankers are not criminals?" wow, whodathunkit. Bankers aren't criminals guys. Man, my ideology is in fucking TATTERS because of this woman's intellect.

As a class, they are exactly as self-interested, self-destructive, and short-sighted as other classes of people that liberals want less highly regulated, such as unions and community organizers.

Right, as a class, those bankers, who act individually and do their best to increase their profits from 1 to 2 gagillion dollars a year no matter what the consequences, are EXACTLY the same as the community organizers who are people the go around, generating collective action so that people can NOT LIVE IN SQUALOR. I-fucking-dentical.

I love Megan.

There She Goes Again

Oh, Megan, I love when you break out the classics.

As traders like to say, "the markets can stay foolish longer than you can stay solvent".

Here's a screen shot of the search results for "you can stay solvent" in MM's posts. Given her propensity for making typos, this may not be an authoritative list.

I thought...

I thought that people who knew something about economics were supposed to be proficient in graphs n shit. Naw, here's what Megan posts:

This, according to Ms. Dufus, shows that Obama is 'falling.' Of course, all data contained in the graph is immediately rendered irrelevant when you plot daily data and use years as the intervals on the x-axis. Stupid graph for stupid people.

Humor Section

rickm brought to our attention, in the item below, that Ms. McArdle is just a bit humor-deficient.

Now I'll note that she is very humor-deficient. Whining about the budget deficit (What does any of this crap mean? Many of the commenters take it as a reason to cut "entitlements," which they of course follow w/: "But I couldn't get elected if I ran on that platform, har har." Oh, what a pain it is living in a democracy, when people are just crying out to be forced to live correctly.) she comes up w/ this attempt at humor:

Either way, we're in for a bumpy ride. Can America get a second job?

In case you haven't noticed, Ms. Megan, much of America is unable to find even a first job. But that's good, as it keeps wages down & the proles scared. (See, I'm learning something about econ from constant reading of Our Muse's web log.)

Elements of Style©:

Nonetheless, this sends a rather clear message: danger, Will Robinson!

Not really funny, because the robot has the voice of a buffoon, & was almost never believed when he used the phrase. And, when following a colon w/ a phrase or sentence, one capitalizes the first word. Especially when the sentence/phrase is a quotation. (We're not sure if it should be in quotation marks in this case, so we'll let that slide.)

P. S.: Megan, getting a second job does not mean flying to a conference somewhere, blathering for 30 mins., taking a few questions, & then retiring to the bar for appletinis before passing out in your free hotel room.

English Only, Please

So you needn't give our muse a click, we reproduce in full (Save for the date & time.):

By request: growth in the Middle
East
Another reader asks:

How much growth in the mideast is attibutable to the rise in the price of oil, how much to normal growth, and how much to the removal of the Saddam regime?

This is of course hard to calculate, but in my opinion the positive value of the second derivative is entirely due to oil.

Does this mean that Ms. McArdle believes that growth in the Mideast is due to oil prices? Again, is she trying to be funny? Poking fun at academic double-speak? Aren't The Atlantic & its web logs intended for a general, albeit educated, audience? Or is it just me?

Perhaps if Megan briefly explained some of this crap she'd be providing a useful service. But if you can't keep it brief, please don't bother.

I'm lazy.

Kathy G isn't.

For those too lazy to click the link, Kathy demolishes Megan's psuedointellectual economic assertions with intellectual economic arguments. It hurt my brain. However, there is this jargonless jem: After Megan said "The problem is that, as [Kathy G's] own commenters point out, the empirical research doesn't quite says what she says it says."

Kathy G's retort: "Go back and read the comments to my post. As of this writing, there are five of them. Four of the commenters agree with me. One of them, ninja_zombie, does not. But s/he doesn't take issue with what I say about productivity. Instead, s/he disagrees what I say about card check, and also argues that the lower profits that are associated with unions means that there will be less investment in unionized sectors, and thus an efficient use of resources. However, ninja_zombie did not write a word about productivity."

Zing! And she's right--Megan just made up the disagreement with commentors. Just flat out lied! We win!

Raging Dull

Megan is quite boring. I shall skip merrily away to a nicer part of the interweb & amuse myself. (It's not really a science, but it sure is dismal.)

Megan McAudio

Ever the masochist, I decided to click on "Radio Free Megan," which turns out to be the "official podcast" (as if there's an unofficial one being bootlegged over the Internet at this very moment, f'r crissake) of Asymmetrical Information. It may not be her fault, but if you wanted to waste 64 minutes of your life, or merely wanted a clue to McArdle family dynamics, you can't listen to her interview w/ her father ("Transit Talk") because the link links to her squawk w/ McCain's econ boy ("McCainomics") which is played back at a very low volume (his voice lower than hers, oddly enough). I'm unable to adjust the volume on the devil-box I'm using, but did turn up the podcast volume to max.

Whether we can blame Ms. McA. directly for the technical difficulties/incompetence, or lay them at the feet of the no doubt underpaid & treated-like-crap geek at The Atlantic is unknown, but it's just typical, innit?

The point being, don't waste your time, in case you were going to. (But you weren't, were you, being wiser than that?)

Big Generalized P. S. (not referring only to McMegan): What really is the point of podcasts? Just transcribe your interminable conversations & let us read them &/or skip through them. Anything spoken can be read through in, say, a third of the time it would take to listen, unless one is listening while ironing or drying the dishes, in which case it's neither compelling nor worthwhile, is it?

brad adds:

She does podcasts and bloggingheads to pad her resume as a fledgling pundit. Think of them as audition tapes for hating on Hillary with Chris Matthews. Fortunately, she's got no screen presence, looks like a Pound Puppy, and very, very clearly has no voice training, so she still has to ratchet her mediocrity up quite a bit to have a shot.

The Big Malig adds (19 February 2008, 1013 PST):

Pound Puppies™ are cute, though.

Just what the hell is "asymmetrical information" anyway?

Great question, Fishbone! We've all been doing a lot of grousing about a certain blog called "Asymmetrical Information" over at the Atlantic - but it's quite possible that some people don't know what that term means. So let's get into it, shall we?

The first (and snarkiest, and most pedantic) answer is that there's no such thing as "asymmetrical" information. However, there is a concept in economics called asymmetric information, which is probably what McArdle was thinking of when she named her blog. Varian (1992) defines it as a "situation[] where one economic agent knows something that another economic agent doesn't (p. 440)." This is a definition I like because it is both clear and simple, which are two qualities sorely lacking in most economics writing. Varian's examples are that of a worker who knows more about his own potential levels of productivity than his boss does, or of a manufacturer who knows more about the potential flaws in the product his company sells than do his customers.

That time you bought a used '77 Pinto nice reliable-seeming used Toyota Camry, and the transmission fell out on the way home? And when you went back to complain, the guy who sold it to you was totally laughing at you out of the side of his mouth? Asymmetric information at work.

The reason that this strikes me as worth talking about is that people like Megan McArdle just looooooove to preach about the Power of The Free Market. Just let the market work, silly liberals, and optimal outcomes will occur while you sleep. Everyone will be better off, the rising tide will lift your shitty little boat too, tra la la.

Clearly, however, that's not true. Sub-optimal outcomes occur, and real-world instances of asymmetric information help bring about sub-optimal outcomes like your car leaving its transmisssion in the middle of the Sunshine Skyway Bridge during rush hour.

The idea that a cheerleader for an unfettered free market would name her high-profile blog after one of the reasons that unfettered free markets don't work out so great is, to me, deliciously ironic and oblivious.

But I'm sure she'll say it was just a joke, right?