Tag Archives: Perverse Incentives

Judge blocks BART union’s proposed strike in San Francisco through October

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“A judge on Sunday blocked a threatened San Francisco-area rail worker strike that could have disabled a critical part of the region’s transportation system serving 400,000 daily passengers.  The BART rail system was shut down for 4-1/2 days in July when union workers walked off the job, creating severe roadway congestion and forcing commuters to miss work or crowd onto a limited number of other public transportation options.  BART management says the average employee gets an annual salary of $79,500 plus $50,800 in benefits, and it is concerned the cost of benefits will continue to climb after increasing by nearly 200 percent in 10 years.”

http://www.rawstory.com/rs/2013/08/11/judge-blocks-bart-subway-workers-proposed-strike-in-san-francisco-through-october/

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India’s financial prophet Raghuram Rajan to run central bank

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“Mr Rajan, a Chicago professor and former chief economist at the International Monetary Fund, clashed openly with US Federal Reserve officials and top policymakers in 2005 over the risk that derivative contracts would amplify any financial crisis once the cycle turned. He said the US had created incentives for destructive behaviour, effectively pushing homeowners and banks into risky ventures. He was called a ‘Luddite’ by none other than Larry Summers, former US Treasury Secretary and now front-runner to take over as Fed chairman. The two men may soon be direct counterparts. Mr Rajan’s warnings were borne out by events.”

http://www.telegraph.co.uk/finance/economics/10227064/Indias-financial-prophet-Raghuram-Rajan-to-run-central-bank.html

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Diamond Jeweler Turns Alleged Smuggler as India Gold Prices Rise

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“In January, jeweler Vihari Sheth was publicizing a ritzy new line of diamond-encrusted designs. Last week, she was arrested at Mumbai airport with nearly $400,000 of gold jewelry in her underwear and on her person. The 27-year-old has a store in Singapore and is married to a director of Mumbai-based Siyaram Silk Mills Ltd (SIYA), a suit maker that is a household name in the country. Her arrest offers a glimpse into how even the wealthy may be joining small jewelers and organized gangs to skirt new government taxes on bullion imports that have made gold about 9 percent more expensive in Indian stores.”

http://www.bloomberg.com/news/2013-08-06/diamond-jeweler-turns-alleged-smuggler-as-india-gold-prices-rise.html

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America’s Foster Care System: Test Lab For Big Pharma, Cash Cow For Caretakers?

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“Of the more than 400,000 children in the U.S. foster care system, it’s estimated that more than 50 percent are on some sort of psychiatric drug. Money is part of the reason. Foster parents are paid more to take care of a child with mental health issues. On average, a foster family earns about $17 a day for taking in a child who needs a basic level of care. But a child who is taking drugs such as antidepressants, antipsychotics, mood stabilizers, anxiety medications or anticonvulsant medications is worth around $1,000 a day. And foster parents are not responsible for paying for the medicines, either, as they are covered by Social Security.”

http://www.mintpressnews.com/america-foster-care-system-psychiatric-drugs-depression/166065/

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Chinese baby ‘sold by doctor’ reunited with parents

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“Zhang Suxia, the doctor responsible for the birth, allegedly persuaded the parents to give up their child last month after informing them he had serious congenital diseases.  The paper reported that a farmer with three daughters bought the baby boy from the alleged traffickers for 60,000 yuan ($9,800).  Trafficking of children is a serious problem in China, blamed in part on the ‘one-child’ policy which has put a premium on baby boys, with girls sometimes sold off, abandoned or put up for adoption. Chinese police rescued 89 children and arrested 355 suspects in December after breaking up a series of child trafficking rings.”

http://www.rawstory.com/rs/2013/08/06/chinese-baby-sold-by-doctor-reunited-with-parents/

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BIS blames European banks for eternal euro crisis

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“Europe’s creditor powers bear as much blame as debtors for the eurozone’s eternal crisis and are blocking recovery by failing to play a full part in righting the ship, according to the Bank for International Settlements.  The BIS said European banks played a huge role in stoking the pre-Lehman credit bubble. They rotated $1.25 trillion into US debt alone between 2003 and 2007, greater than the combined purchases of Asia and OPEC. It said banks funnelled money into southern Europe regardless of risk in ‘expectations of a bail-out’ if any country got into trouble.”

http://www.telegraph.co.uk/finance/financialcrisis/10221869/BIS-blames-Europes-creditors-for-eternal-euro-crisis.html

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Graphic: How Just 6 Corps Own 90% of The Media

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“One graphic really highlights just how tightly controlled the information we are delivered truly is — and how a total of only 6 corporations run the show. From Time Warner (CNN, HBO, TIME) to GE (NBC, Comcast), a whopping 6 corporations control 90% of the mainstream media within the United States. The amount of revenues from the tightly controlled mainstream media machine are enough to beat out Finland’s entire GDP, buy every NFL team 12 times, and fund the government bailout of General Motors 5 times.”

http://www.storyleak.com/graphic-6-corporations-own-90-percent-of-media/

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We Are Becoming a Nation of Burger Flippers

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“The American workforce is slowly converting to a force of burger flippers and shelf stockers, mostly older people in semi-retirement. The implications for the economy are serious, and the ballooning cost of health care for businesses under Obamacare bears much of the responsibility: The law’s (expensive) mandate that employees who work over 30 hours per week receive mandatory health benefits is suppressing the hiring of full-time workers, particularly by small businesses. Even Sen. Max Baucus, one of the law’s architects, said ‘I just see a huge train wreck coming down,’ at an April 17 hearing.”

http://dailyreckoning.com/we-are-becoming-a-nation-of-burger-flippers/

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In U.S., Fewer Young Adults Holding Full-Time Jobs in 2013

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“The barriers for the young getting a job in the U.S. remain high. Given ever growing regulations on employers, coupled with the uncertainty of Obamacare, it just makes it to risky for most employers to be aggressively hiring.  Fewer Americans aged 18 to 29 worked full time for an employer in June 2013 (43.6%) than did so in June 2012 (47.0%), according to Gallup’s Payroll to Population employment rate. The P2P rate for young adults is also down from 45.8% in June 2011 and 46.3% in June 2010.”

http://www.economicpolicyjournal.com/2013/08/in-us-fewer-young-adults-holding-full.html

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Former IMF Chief Economist: Sadly, Too Big to Fail Is Not Over

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“There are three issues: the powers of the Federal Reserve, the mandate of the Federal Deposit Insurance Corporation and the vulnerability of taxpayers when one or more large complex financial institutions fail. We have at least five such companies in the United States, all of which are intensely cross-border in their operations (in order of size, JPMorgan Chase, Bank of America, Citigroup, Goldman Sachs and Morgan Stanley).  The biggest and most leveraged financial companies in the United States today are all now bank-holding companies, with access to the discount window at the Fed, via their commercial banking subsidiaries.”

http://economix.blogs.nytimes.com/2013/08/01/sadly-too-big-to-fail-is-not-over/?emc=eta1&_r=1

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