A new series of article summaries to help true gentlemen- Monsieurs, get a better handle on things going on globally, culturally and nationally. Consider this a cheat sheet for intellectual conversations.
In a recent New York Times article, an economics professor explained that if you’re in the bottom of the looks department, you earn as much as 15 percent less than someone more attractive. Catherine Hakim, a professor of sociology and the author of the soon-to-be released book Erotic Capital: The Power of Attraction in the Boardroom and the Bedroom, believes that discrimination is part of life itself, “We discriminate between people who are intelligent and stupid. We discriminate between people who are attractive and unattractive.” [Read the rest on Slate]
2. Why You Should Bet on the US Dollar
As Europe’s woes grow, the dollar could stage a strong comeback, rising 40% against the euro by September 2012. If currency adjustments within the euro zone aren’t possible, however, then why not outside it? The dollar looks historically undervalued in relation to the euro (see chart). A good case can be made that the dollar is a buy at its current price of 70 European cents. The greenback might climb to parity with the euro over the next 12 months. Inversely, this means the euro, now worth about $1.43, would fall to $1, still well above its 82.7-cent low of October 2000. [Read the rest on Barrons]
The Monsieur’s Cheat Sheet: If you’re earning Euro or Aussie Dollars, I say go ahead- invest in the US dollar on the cheap. If all else fails, it’s still anyone’s guess if we’d still be here when September 2012 rolls around.
3. Fight of the Ages: Keynes-Hayek Rematch
When then British Prime Minister Margaret Thatcher quoted Hayek’s The Road to Serfdom (1944), his classic attack on central planning, his tirade against the gross inefficiency of central planning won increasing assent. Keynes on the other hand held the view that market systems require continuous stabilization lingered on in finance ministries and central banks. We seem to have come full circle since the Great Depression – the global economic collapse of 2008 discredited “rational expectations” economics model, and has since brought both Keynes and Hayek back into posthumous contention. [Read the rest on Project Syndicate]
The Monsieur’s Cheat Sheet: Hayek demands more austerity, Keynes more spending. Although the author asserts more spending, the problem is that the middle classes are increasingly squeezed into lower economic echelons can’t afford to spend anymore. However, Hayekians and their idea that central banks are the fount of crisis with excessive credit creation are barking up the wrong tree; If anything, the market is held more to paranoia and human errors of optimism and pessimism. In short, consumers aren’t rational. Point Keynes.
If you must print this cheat sheet for intellectual conversations, make sure to use recycled paper OR print on both sides of a fresh sheet.