Category Archives: Moral Hazard

Moral Hazard

Three Cheers For A Housing Market Recovery, Maybe

Price reduced? Good news for one third of Americans, but not for Peter Dreier From the NYT: What Housing Recovery? In the New York Times Opinion Pages Peter Dreier (Professor of Politics, Urban and Environmental Policy at Occidental College) bemoans that not … Continue reading

Posted in Adverse Selection, Economics, Geography, Housing, Inflation, Markets That Won't Clear, Money, Moral Hazard, You're Not Helping | Tagged , , , , , , , , , | Leave a comment

Flash Boys: A Wall Street Revolt, by Michael Lewis

For 300 million dollars, your web browser could receive this post three milliseconds faster I’ve just finished reading Flash Boys: A Wall Street Revolt by Michael Lewis, an exposé on the rampant parasitism at the core of the U.S. stock … Continue reading

Posted in Asymmetric Information, Books, Capital Markets, Crony Capitalism, Economics, Money, Moral Hazard, Technology, The Future | Tagged , , , , , , , , , | Leave a comment

This Landslide Caused More Than One Phase Change

“This was a completely unforeseen slide…” – said no geologist or soil scientist A Phase Change is the transformation of a system from one state of matter to another. Think of ice cubes melting in your soft drink while water condenses … Continue reading

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Federal Flood Insurance: A Rising Tide of Voter Demands

It’s not fair From the NYT: Popular Flood Insurance Law Is Target of Both Political Parties It seemed like a good idea at the time.  The Biggert-Waters Flood Insurance Reform Act of 2012 was intended to start charging homeowners actuarially fair premiums for … Continue reading

Posted in Economics, Geography, Insurance, Moral Hazard, Natural Disasters, You're Not Helping | Tagged , , , , | Leave a comment

Moral Hazard In Tornado Alley

From the NYT:  Racing the Clock and a Storm: A Way of Life in Tornado Alley I liked Twister better as a movie There are two ways to minimize losses in a natural disaster: reduce the severity of the loss or … Continue reading

Posted in Economics, Geography, Insurance, Moral Hazard, Natural Disasters | Tagged , , , | 1 Comment

Making The Price Of Failure Too High: Dubai Edition

From Messy Nessy Chic: So in Dubai, the number of Abandoned Luxury Cars lying around is kind of a Problem What this airport needs is more really long term parking When designing a civil society, one of the knobs you … Continue reading

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Mortgage Writedowns and Moral Hazard

From the WSJ:  How Forgiveness Fits in Housing-Fix Toolkit The argument for embracing principal forgiveness invokes the negative externalities of “underwater” houses (in which the market value is below the mortgage value): The massive debt overhang—totaling almost $700 billion—is troubling … Continue reading

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Markets That Won’t Clear: Housing

What’s preventing this market from clearing? A few suggestions: Stubborn rights-holders Property owners, bankers and local governments holding out for a bail-out A coordination failure as who wants to live in a community when no one else does Refusal to … Continue reading

Posted in Coordination Failure, Economics, Housing, Markets That Won't Clear, Moral Hazard | Tagged , , , , | 3 Comments