Floating-rate Treasury Debt?

Bloomberg has an intriguing April 29 article on Treasury Floaters According to Bloomberg, the Treasury may announce on May 2 that it will issue floaters. It quotes Cam Harvey, who testified that floaters as being a great idea in 1993, as disapproving.   Knowing Cam,  I suspect he had a more sophisticated view in mind.

Issuing floaters and converting a lot of debt to floating-rate debt is a great idea, if done right, even if the maturity structure of government debt should be much longer now. Let me explain.

Speculation and gas prices

I was getting myself frothed up about the recent idea that  "speculators" are behind the recent gas price increase.  Have we learned nothing in the centuries of witch hunts for "speculators" "middlemen" and "money changers"? And how horribly things go wrong when societies take these witch hunts seriously? Haven't the Europeans just woken up from a severe attack of denial that "speculators" were to blame for their sovereign debt crisis?

Then I found that Jim Hamilton already did a better job than I could hope to do, while skewering Rep. Joseph Kennedy's editorial in the New York Times calling for a ban on speculation. 

How to lie with statistics

Along with David Leonhardt's interesting article "Taxmageddon," last weekend's  New York Times Sunday Review included this pair of graphs. These belong high up in the pantheon of "How to lie with statistics" (one of my favorite books) examples. 

Money Market Runs

A good oped in Bloomberg's "Business Class" series tackles money market funds. (I signed it along with the rest of the Squam Lake group, but I can't take credit for much of the writing.)

There was a run in money market funds. We have to do something about this.

Price and volatility in the great crash

I made the following cool graph last week. (Well, I think it's cool):

Supreme court and health insurance part II

Yesterday's post morphed into a Wall Street Journal Op-Ed, reprinted below.

Why am I going on? I think too many people don't understand there is a coherent free-market, deregulated alternative. President Obama himself said today,

"I think the American people understand — and I think the justices should understand — that in the absence of an individual mandate, you cannot have a mechanism to ensure that people with pre-existing conditions get health care."   

This just isn't true. I don't blame Obama, but his health insurance advisers ought to know better. "Guaranteed Renewable," or "premium-increase insurance" is a possibility. It solves the genuine pre-existing conditions problem. It's been in the academic literature for almost 20 years (see e previous  Articles,  Opeds, Blog posts and citations in the Articles, especially to Mark Pauly's work and extensive coverage on Cato's health insurance and Universal Heath Care sites). A deregulated, competitive market can work. 

The WSJ Oped: