Category Archive

I think the market got a little bit ahead of the economy. I do not think the recovery is faltering. If you look at the projections that were made in December of last year, we’re right on track.
—James Bullard, President, Fed Bank of St. Louis

all the big negatives for the economy are becoming much less negative
—Mark Zandi

Things are bottoming out, and they are even coming back in some sectors…I’d mention the automotive sector [as one area that is starting to recover]
—Klaus Kleinfeld, CEO of Alcoa, Bloomberg Television interview on July 7.

When Medicare reduces its payments to doctors, it rations money to them. It does not directly ration the health care the doctors might render patients.

If physicians refuse to treat patients at the lower fees, it is they who ration health care, even if the incentive to do so came from Medicare.
—Uwe Reinhardt on compensation in medicine

Be careful investing here
—Rupert Murdoch on Twitter

I don’t know if it’s monetizable.
—John Malone on Twitter

Hell no. Facebook is like a directory. How they make money is another matter
—Rupert Murdoch, on selling MySpace. Instead he emphasized turning it into the preeminent entertainment portal

FT

look at the industry and gauge the extent to which there are network effects and the extent of switching costs, and build your strategy around this

People are always talking about information overload, and the quantity of information on the internet, but the real change is that the cost of accessing information has fallen dramatically

[Supermarkets] are saving hundreds of thousands of dollars per store on broadcast newspaper adverts.

—Hal Varian, from the website for his and Carl Shapiro’s book, Information Rules. Varian points to the use of IT by supermarkets which analyze consumers’ buying habits and then offer them price discounts on an individual basis, via direct mail or with coupons on the back of their receipts.

It’s not an economic downturn, it’s an opportunity. I’m not going to minimize what’s going on in the economy, but it’s exciting and the entrpreneurial spirit in this country hasn’t changed.”
—Herb Allen III

Mr Anderson believes that this allows the vision of the French economist Joseph Bertrand to be fulfilled. As companies compete vigorously, prices fall to just above the marginal cost of production. Since the marginal cost of making a piece of software is zero, and the cost of digital distribution is zero, prices ought to fall to free.

His vision has two flaws. First, as Hal Varian, Google’s chief economist, has pointed out, network effects unleashed by digital technology tend not to spawn free competition among equals but a “winner takes all” effect in which a single company emerges with all the spoils. In the software era, that company was Microsoft; in the internet era, it is Google.

The second flaw is that, even if the cost of digital distribution is lower than that of physical distribution, the marginal cost of production is not cut to zero. Companies have many costs, from marketing to employing people to make things. Offering things free on the internet is loss-leading just as surely as handing Jell-O recipe books to American housewives was in 1904.

—FT: John Gapper

AVC: Fred Wilson

New Yorker: Malcolm Gladwell

As with so many other things, we don’t want to know.
—Bob Herbert on MJ

If I were a seller, I would take the risk out of the calculation. Time does not necessarily equate to money here for the seller.
—Pamel Liebman, CEO of Corcoran

The standstill that existed after Lehman Brothers has been broken, and it was the sellers that cried ‘Uncle.’ …The sellers who want to sell are reducing their prices. The ones that aren’t, are either sitting on them overpriced or waiting for another day.
—Pamel Liebman in Bloomberg

We will probably get a little worse before it is going to get better because unemployment is likely to continue to rise after the recession ends this year.
—Jonathan Miller, Miller Samuel

The market took a nose dive and business virtually stopped in September. Now you are seeing people at least spending money again. I am not saying it is a different world; buyers are still looking for value.
—Dorothy Herman, President of Prudential Douglas Elliman

A government that works, some conservatives fear, is dangerous stuff. It gives people ideas…it’s a gateway drug to broader state involvement in the economy and hence a possible doomsday scenario for conservatism itself.

…government fails constantly when conservatives run it because making it work would be, for many of those conservatives, to traduce the very laws of nature.

…This is the perverse incentive that is slowly remaking the GOP into the Snafu Party.

…”You didn’t really think government could work, did you?”
—Thomas Frank in the WSJ

I think we’re going to see a temporary substantial improvement. I emphasize the words temporary and substantial.

…We’ll get a bounce for a few quarters and then it will fade out. We’re now going through the getting-better phase for a while…I don’t worry if they have instruments to do it. What worries me is the political hurdle they’ll be facing.

…The Fed can set the benchmark rate to be near zero and yet longer-term rates have a life of their own. The benchmark rate may not matter nearly as much as it used to.

—Martin Feldstein

—MBA mortgage purchase/refinance application index – down 19%: from 548.2 to
to 444.8 in the week ended June 26.
—MBA refinancing index – down 30%, the lowest in seven months
—MBA purchasing index – down 4.5%