Economy

So Wired mag has a cover story on Craig Newmark and his 'enigma' that is craigslist, and some side pieces in the epicenter blog . I have a feeling that the author is trying to give a balanced story, I guess. Is it me though, or does it seem like there's an implied disdain/rejection/confusion of some people running a business (or more like a foundation or something) that doesn't really care about maximizing profit? Ok, so they're not like everyone else, but isn't this a free country? They're dominating a section of internet 'commerce' and somehow by not raking in the cash and showering us with ads they're doing something wrong?

I'm a craigslist fan, having sold a ton of stuff over the past several years. Yes, the UI is basic - but that's part of the deal. It's simple, no BS, and that's it. Heck, half the for-sale listings are so brief and lacking pictures you wonder if people would know what to do with more features. Promoting local commerce in this carbon-footprint fearing time seems like a good thing to me also.

Long live craigslist.

From ED, some basic facts on transportation in the US. Of note - the fact that not owning a car and using public transit can save a decent amount per year (which mortgage companies take into account), coupled with the fact that nearly half the population doesn't have real access to public transit. Then notice that even more drilling for domestic oil production won't have much of an effect for a while (I think ED is shooting a bit long, but at least 10 years is a good guess).

 

So you'd think this would be something our government would be interested in helping out with. Not really. our current misguided transportation secretary used some carefully constructed words to intimate that since the gas-tax funds for road construction are running out (surprise - people are driving less now), they might want to use some of that transit money to fund road construction. Hopefully we've all misconstrued her (nice to hear from the feds that road projects might actually have to prove themselves the way that transit projects do), but no way to tell at the moment.

 

I don't even want to talk about malicious neglect that the current administration has shown towards Amtrak. Oh that we had a good regional rail system in this country (on, and on, and on, and on...)

So what we have at the moment: mass transit use is growing pretty much everywhere in the country, and at the same time the transit providers, often forced to rely on sales, petroleum use, property, and other taxes for operating income, are hurting for money. So they're going to the other source they have - raising fares, and some even cutting service.

But hey, maybe the USDOT will find a way to fund those roads that are being used a bit less now.

 

So congress held hearings for many hours on why oil prices were so high, mostly focussing on the effect of speculators in the market. I was wondering if what they were talking about had any merit - in my view, speculation can jack prices up in some markets, like housing - you can only bet it one direction, really - but it depends on how it works. In commodities markets, it's a useful tool for hedging by actual companies.

 

It's was nice to read this article in the NYTimes about how the congressional hearings were mostly bluster. Some good quotes:

Even if you eliminated speculation entirely, the price of oil wouldn’t fall. Thankfully, no one is proposing to go that far ... because even members of Congress understand that futures markets serve a crucial purpose. They help companies hedge their oil prices, and they help energy companies manage their risk, for starters.

The energy speculators I spoke to say that Congress has it exactly backward: the futures market is actually taking its cues from the physical market, where the buyers and sellers of oil do their business. Last week, the Saudis promised to produce an extra 200,000 barrels a day. But it is pricing that oil so high that oil companies are balking at paying for it....

 

Both speculators and oilmen say that supply and demand is the real culprit. ... said Gary Ross, the chief executive of the PIRA Energy Group, and a well-known energy consultant. “Look at the data.... The world economy is growing by 3.9 percent a year. World oil demand should grow by 2.3 percent just to keep pace. That’s an extra two million barrels a day. We don’t have it! It’s obvious.”

 

I also think there is something else at play. After years of ignoring the rather obvious fact that oil is a finite resource, the world has suddenly become acutely aware of that reality.... That is not speculation at work — it’s market psychology. There’s a big difference. If there is indeed a bubble, that’s what is causing it.

What does it actually mean for a country to comply with the Kyoto emissions targets? Will it really have a bad effect on the economy of a country that tries to implement it? An interesting perspective on how it might affect Canada.

Don't worry about a crash, just a much slower or maybe nonexistent rate of home price growth. Global Insight with some recent data:

New data released by the Office of Federal Housing Enterprise Oversight (OFHEO) reveal that price appreciation is now nearly at a standstill in almost all of the top 20 markets, and in some, prices are actually declining.

The designer of the cubicle office furniture even disliked the ways that his design ended up being used - that is, to pack lots of us into small office spaces.

Over the summer I wrote a paper for school that took a high-level look at how investment in a transportation facility would affect the economic development outcomes of an area, with specific reference to the Interstate 86 corridor of the Southern tier counties of New York State. In the interest of open scholarship, I figured I would make the paper available online:

What Will the Future Bring? The Economic Development Impacts of Transportation Investment and a Look at the Interstate 86 Project (460 Kb PDF)

This is not exactly new news, which is why I guess it is in the Arts & Leisure section, but Nicolai Ouroussoff has written a great article on the pumps that were supposed to keep the water out of New Orleans and the general deterioration of urban infrastructure in this country over the past several decades.

Keeping his eye on the bigger picture, Nicholas Kristof writes a great op-ed piece in the New York Times today. What happened in Louisiana and Alabama because of hurricane Katrina definitely had the worst effect on the poor, and the US is not doing a very good job of helping the poor in normal weather, either:

This is the official web site sponsored by the three main credit reporting companies where you can get your free credit report once a year.