Quote of the Day
Professor Mark J. Perry's Blog for Economics and Finance
“In a nutshell, the key formula for the coming age is this: Open, good. Closed, bad. Tattoo it on your forehead. Apply it to technology standards, to business strategies, to philosophies of life. It's the winning concept for individuals, for nations, for the global community in the years ahead.
Cuba's got a revolutionary blogger and freedom fighter - Yoani Sanchez, who blogs at "Generacion Y," and has been frequently featured on Carpe Diem. This morning I heard about Yoani's counterpart in Tunisia - 22-year old Lina Ben Mhenni (pictured above), who blogs at "A Tunisian Girl," and who was featured on NPR this morning. In an interview, Lina discusses how Facebook, Twitter and blogs played an important role in spreading information and helped bring down the president's regime.
Washington, D.C. – January 19, 2011 – "On the heels of its highest mark since 2007, the Architecture Billings Index (ABI) jumped more than two points in December. As a leading economic indicator of construction activity, the ABI reflects the approximate nine to twelve month lag time between architecture billings and construction spending. The American Institute of Architects (AIA) reported the December ABI score was 54.2, up from a reading of 52.0 the previous month. This score reflects an increase in demand for design services (any score above 50 indicates an increase in billings). The new projects inquiry index was 62.6, up slightly from a mark of 61.4 in November."
Let Them Eat Carp.
The New York Federal Reserve reported today that "the Empire State Manufacturing Survey indicates that conditions for New York manufacturers improved in January. The general business conditions index rose 2 points to 11.9 (see chart above). The new orders index moved up 10 points to 12.4, and the shipments index surged 18 points to 25.4. After a sharp decline last month, the inventories index rose above zero. Employment indexes also climbed into positive territory. Both the prices paid and prices received indexes rose, pointing to an acceleration in both input prices and selling prices.
From Ward's Automotive, the Top Ten Best Selling Cars and Trucks for 2010:
|1||Toyota Camry||327,804||Ford F Series||528,349|
|2||Honda Accord||282,530||Chevy Silverado||370,135|
|3||Toyota Corolla/Matrix||266,082||Honda CR-V||203,714|
|4||Honda Civic||260,218||Dodge Ram Pickup||199,652|
|5||Nissan Altima||229,263||Ford Escape||191,026|
|6||Ford Fusion||219,219||Toyota RAV4||170,877|
|7||Chevy Malibu||198,770||Chevy Equinox||149,979|
|8||Hyundai Sonata||196,623||GMC Sierra||129,794|
|9||Ford Focus||172,421||Ford Edge||118,637|
|10||Chevy Impala||172,078||Chrysler Town & Country||112,275|
People in DC do some crazy things in the winter, see the picture above of a car parked in the building behind my apartment building, with its windshield wipers propped up in the air, allegedly to prevent the wipers from freezing on the windshield when it snows. I wrote about this last winter, see the post and picture here, I am still not at all convinced that this is an effective method to deal with winter snow. And it hasn't even really snowed yet in DC this winter, and yet I have seen many cars like this one, with the windshield wipers up in the air.
The "priciest piece of aluminum in NYC" - a taxi medallion that is required to operate a single cab in NYC - reached a new record-high of $624,000 in December for an individual medallion (see chart above, data here), more than double the average price for a medallion in 2004. The average price for a corporate-owned taxi medallion reached a new record high of $850,000 at the end of last year. Here's a classic article about taxi regulation from Jeff Jacoby, written back in 1995 when the NYC medallions were selling for only $140,000:
The taxi business, after all, ought to be a model of free enterprise. There are plenty of buyers (passengers), plenty of sellers (drivers), and no barriers to entry beyond the price of a car. If it weren’t for government interference, the laws of supply and demand would govern the taxi trade with almost frictionless efficiency: Cabs would be plentiful, fares would be reasonable, and service would be available nearly everywhere it was wanted.
But governments do interfere. Taxi owners routinely get the state to kill their competition. “London’s first recorded taxi war, in 1636, did just that,” the Economist recalled some years ago. “Sparked by the resentment of Thames water taxis at growing competition from coaches on land, it led to a proclamation from King Charles I restricting the number of coaches to 50. Lucky coachmen were happy. Watermen were happy.” But customers got gypped.
A lot of medieval practices have been junked since 1636, but protectionist taxi regulations aren’t among them. Nearly every major US city (and thousands of smaller ones) chokes off access to the taxicab market. Exactly 11,797 taxicabs, for example, are permitted to operate in New York City — a figure that hasn’t budged since World War II. FDR was in his first term as president when Boston decreed that only 1,525 cabs would be permitted on its streets. Other than a few new medallions for wheelchair taxis, 1,525 remains the limit.
The results? Right out of Econ 101: The supply of taxi medallions is far lower than the demand, so their value long ago exploded to obscene levels. Today, the going rate is about $140,000 in New York; about $90,000 in Boston. Those who got medallions when the getting was cheap grew rich. Everyone else got shafted. Would-be cabbies are forced to choose between going deeply into debt to buy a medallion or paying murderous lease rates to somebody who owns one. “In essence,” write Chip Mellor and John Kramer of the Institute for Justice, “cab drivers become urban sharecroppers.”