Friday, May 03, 2002

Not related to tech Two not related to technology posts today. First of all, the NYTimes has revisited the discriminatory mortgage lending story in Boston. Unfortunately, the new study is as worthless as the old one, because the people in charge of it don't know what they're doing.

Prejudice is a consumption good just like orange juice or Nintendo games. The only real evidence of prejudice would be if loans to Hispanic or black borrowers were more profitable than loans to white borrowers. Prejudiced loan officers would want to "buy" there prejudice where it was cheapest, which means the least profitable black and Hispanic customers, resulting in higher than average returns on their loan portfolios. But no one understands any of this and so the cost of borrowing will just needlessly go up for everyone, harming all.

In other news, my money is on The Essence of Dubai to win the Kentucky Derby. And no, this is not because I lived there. The horse is proven at 1 1/4 miles, unlike Buddha (now dropped out), Johannesburg, Medaglia d'Oro, and Castle Gandolfo. And he's a better horse than Saarland, the wiseguy pick.


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