John Cochrane is professor of finance at the Booth School of Business at the University of Chicago and is an expert on the theory of asset pricing. You can take (or audit) his free online course through Coursera. In this course he starts out by briefly summarizing the state of the art in asset management… Read more

Previously published on September 2, 2015 on Fox and Hounds As California weathers its fourth straight year of extreme drought, policy makers and their cheerleaders continue to scapegoat California’s agricultural industry. Writing in the Sacramento Bee, economist Christopher Thornberg, for example, refers to the industry as “feckless” and advocates using eminent domain to seize farmers’… Read more

John C. (Jack) Bogle graduated from Princeton University in 1951 and founded The Vanguard Group, Inc. in 1974. In 1975, Vanguard introduced the first so-called “Index Fund” based on the Standard and Poor 500 (S&P500) stock index. The S&P500 is a market capitalization weighted average of 500 of the largest stocks that trade on the… Read more

Previously published on August 29, 2015 on NewGeography.com I recently made a couple of tweets/Facebook posts pointing out that market declines threaten California’s budget surplus. I referenced articles in the WSJ and Bloomberg, and I thought the observation was non-controversial—almost banal. So I was surprised at the feedback. One person asked why. Another said it… Read more

In general, we expect that a beginner or novice in a field is likely to be out-performed by a seasoned veteran. We would be surprised if a beginner could build a better house than a skilled carpenter, or if an amateur boxer could knock out a pro. Yet, something like this may be true in… Read more

Bryan Caplan at George Mason University and the Library of Economics and Liberty has a couple of posts on medical screening and treatment. First, Caplan shares data on prostate cancer.  It turns out that screening does nothing good for the patient: That’s right.  Statistically speaking, prostate cancer screening is worthless.  Over the course of ten years,… Read more

I’ve argued for some time that services for the wealthy will be a major source of Coastal California jobs in coming years.  As people become more wealthy, they increase their specialization.  That is, wealthy people specialize in consumption and whatever it is that brings them their wealth.  That may mean specializing in consumption and in… Read more

Several years ago I was asked to speak at a dinner meeting for some customers of a large insurance company.  It so happens that another economist, Gene Stanaland, was the featured speaker in the afternoon session.  Gene turned out to be a professional speaker who bills himself as the “Will Rogers of Economics.”  He was… Read more

During the buildup to the financial crisis, mortgage underwriting standards weakened dramatically.  Although there have long been loans made with low or no down payments, or to people with FICO scores below 660 or even 600, or to people who did not wish to provide full documentation, it was rare to find loans made that… Read more

People are always writing about the best places to to buy homes, retire, get a job, etc..   Only one problem, thought.  These are always backwards looking, and things change.  In this case, they changed before the report could by published: The (best) metropolitan area for flipping a house was Baltimore-Towson, Md., where the average… Read more