Tuesday, May 31, 2011

Is Twitter done?

Foursquare probably wins the prize for biggest fad, but twitter may be close behind. I did not know that twitter traffic has been flat for 18 months.

Friday, May 27, 2011

The Government is not like normal people

From Megan McArdle:
But the government does not borrow and save like normal people--its constraints are different. The closest it can come to saving is to pay off debt. And our debt is not yielding 5.25% right now; our highest-yielding debt is paying 4.375%, which the government is trying to sell more of, not pay off, in order to lengthen the average time-to-maturity of the debt held by the public, which lowers the risks to the Treasury of a sudden interest rate spike.
The constraints of a currency issuer are different--in that "saving" as a concept makes no sense. The Government doesn't "have" or "not have" money. It prints money when it spends. It unprints when it taxes. Its goal is to have printed as much as the non-govt sector wants to save.

Why would any entity need to stockpile what it can create costlessly at will?

Tuesday, May 10, 2011

Yes, the problem is the elites

Paul Krugman correctly identifies the economics problems of recent years to the elites:
The past three years have been a disaster for most Western economies. The United States has mass long-term unemployment for the first time since the 1930s. Meanwhile, Europe’s single currency is coming apart at the seams. How did it all go so wrong?

Well, what I’ve been hearing with growing frequency from members of the policy elite — self-appointed wise men, officials, and pundits in good standing — is the claim that it’s mostly the public’s fault. The idea is that we got into this mess because voters wanted something for nothing, and weak-minded politicians catered to the electorate’s foolishness. So this seems like a good time to point out that this blame-the-public view isn’t just self-serving, it’s dead wrong.

The fact is that what we’re experiencing right now is a top-down disaster. The policies that got us into this mess weren’t responses to public demand. They were, with few exceptions, policies championed by small groups of influential people — in many cases, the same people now lecturing the rest of us on the need to get serious. And by trying to shift the blame to the general populace, elites are ducking some much-needed reflection on their own catastrophic mistakes.
Unfortunately, the class most at fault are academic economists like Paul Krugman. Because they do not understand basic accounting, and because they do not understand monetary operations, they push bad policy through the iron polygon of newspapers, government agencies, universities, and talk shows.

When people save money in a bank that money becomes "dead" because deposits do not fund loans. Quite the opposite -- loans create deposits. Since the demand for this dead money changes unpredictably, the Government must fund that desire by printing (and unprinting) money to maintain full employment and price stability. This is measured by the deficit. The US drained the private sector of its savings during the Clinton surplus, leading to an overleveraged population which remains out of money and work because Obama won't run sufficiently large deficits. Europe eliminated its ability to respond to this change in demand at all as it has no centralized currency issuer. And, when one realizes the entire point of private sector credit extension is credit analysis, most of Wall Street securitization becomes a sham -- these loans are better left on bank balance sheets as receivables than traded.

All of this came straight from the Ivory Tower, where Paul Krugman sits today trying to shift the blame to other people.

Monday, May 09, 2011

Can Apple become Jobsian?

Asymco wonders if Apple is becoming more "Jobsian" (and therefore, better able to succeed in the post-Jobs era) by building Steve U:
According to the article in Fortune and some additional details from another source, Joel Podolny has been building an understanding of how Apple is run. He’s then been asked to codify this understanding into a curriculum that can be taught to Apple employees.

The idea that Apple is trying to capture its institutional processes and knowledge is very compelling. Few companies have self-knowledge. Fewer still try to codify it and teach it to new generations of leaders (Disney, McDonalds and Toyota have in-house training programs but they are mostly aimed at new hires).
Coming from the Product world, I am very skeptical that Apple's process can be institutionalized via any form of academic canonization. The etiology of Apple's success is not rooted in process or institutional knowledge, it's rooted in politics, where the CEO is also the Chief Product Officer. Design is about compromise, and the mindset of the CEO will tell you what will get compromised for what else.