" .. the economy will eventually recover 'despite' these policies, rather than 'because of them ..'

" .. In this relatively favorable scenario, we may follow the path recently sketched by Federal Reserve Chairman Ben Bernanke, with the economy recovering by 2010. On the other hand, the 59 nonwar depressions in our sample have an average duration of nearly four years, which, if we have one here, means that it is likely recovery would not be substantial until 2012.

"Given our situation, it is right that radical government policies should be considered if they promise to lower the probability and likely size of a depression. However, many governmental actions -- including several pursued by Franklin Roosevelt during the Great Depression -- can make things worse.

"I wish I could be confident that the array of U.S. policies already in place and those likely forthcoming will be helpful. But I think it more likely that the economy will eventually recover despite these policies, rather than because of them."

Joke about economists -- nice young lad, afraid of blood, who still wants to be called "doctor."

"Moral Hazards" while traveling

http://www.economist.com/research/Economics/alphabetic.cfm?letter=M#moralhazard

Moral hazard

One of two main sorts of MARKET FAILURE often associated with the provision of INSURANCE. The other is ADVERSE SELECTION. Moral hazard means that people with insurance may take greater risks than they would do without it because they know they are protected, so the insurer may get more claims than it bargained for. (See also DEPOSIT INSURANCE, LENDER OF LAST RESORT, IMF and WORLD BANK.)

Per the Fannie/Freddie disaster -- when Americans travel overseas in questionable areas -- who bears the cost of saving them? As in this case --

http://www.inthenews.co.uk/news/autocodes/countries/south-korea/taliban-free-more-hostages-$1127908.htm

Taliban insurgents released all remaining South Korean Christian aid workers held in Afghanistan today.

The remaining seven hostages were released in two groups on Thursday, one day after 12 of the hostages held since mid-July were freed.

Agreement had been reached on Monday between the Taliban and South Korean negotiators to end the hostages' ordeal.

South Korea will remove its 200 troops and all missionaries and other civilians from Afghanistan by the end of the year in return for the release.

The 23 South Koreans originally captured were abducted as they travelled from Kandahar to Kabul on July 19th.

Two male hostages were subsequently killed after Taliban gunmen said their demands were not being met, while two female missionaries were later released as a goodwill gesture.

The world is a dangerous place. Obviously.

Warren Buffett on the economy: "America's best days lie ahead"

From his most recent shareholders' letter --

• The sub-prime SNAFU/FUBAR was so bad, "strong and immediate action by government was essential last year."
• All the government bail-outs makes inflation likely.
• "Moreover, major industries have become dependent on Federal assistance, and they will be followed by cities and states bearing mind-boggling requests. Weaning these entities from the public teat will be a political challenge. They won't leave willingly."
• ".. Amid this bad news, however, never forget that our country has faced far worse travails in the past. In the 20th Century alone, we dealt with two great wars (one of which we initially appeared to be losing); a dozen or so panics and recessions; virulent inflation that led to a 21 1/2% prime rate in 1980; and the Great Depression of the 1930s, when unemployment ranged between 15% and 25% for many years."
• "Without fail, however, we've overcome them. In the face of those obstacles - and many others - the real standard of living for Americans improved nearly seven-fold during the 1900s, while the Dow Jones Industrials rose from 66 to 11,497 .. "
• "Though the path has not been smooth, our economic system has worked extraordinarily well over time. It has unleashed human potential as no other system has, and it will continue to do so. America's best days lie ahead .."

Medical care -- more than the surgeon's fee

Much has been made about the cost of medical care and "the benefits of medical tourism." Well, to quote an old professor -- "it is a little more complicated than that."

The price/cost? That's getting easier to find. Here's the reported cost of a heart transplant --

http://wiki.answers.com/Q/How_much_does_a_heart_transplant_cost

Is that enough?

Of course not. So many other factors -- pre-surgery, your GP, after-surgery.

Complicated. Not atom-splitting. But not simple, either.

A cautionary tale: Harvard's financial hubris

Stocks were tumbling last fall as the new school year began, but at Harvard University it was as if the boom had never ended. Workers were digging across the river from Harvard's Cambridge, Mass. home, the start of a grand expansion that was to eventually almost double the size of the university. Budgets were plump, and students from middle-class families were getting big tuition breaks under an ambitious new financial aid program. The lavish spending was made possible by the earnings from Harvard's $36.9 billion endowment, the world's largest. That pot was supposed to be good for $1.4 billion in annual earnings.

Behind the scenes, though, a different story was unfolding. In a glassed-walled conference room overlooking downtown Boston, traders at Harvard Management Co., the subsidiary that invests the school's money, were fielding questions from their new boss, Jane Mendillo, about exotic financial instruments that were suddenly backfiring. Harvard had derivatives that gave it exposure to $7.2 billion in commodities and foreign stocks. With prices of both crashing, the university was getting margin calls--demands from counterparties (among them, jpmorgan Chase and Goldman Sachs (nyse: GS - news - people )) for more collateral. Another bunch of derivatives burdened Harvard with a multibillion-dollar bet on interest rates that went against it.

Res ipsa.

Personal: a note on venture capital, post-Fannie/Freddie

"Life is hard," wrote M. Scott Peck, M.D.

SHEESH! No kidding! Just a year ago, so many things seemed possible. Now -- VC for bio-tech appears lifeless.

But yesterday, an MBA/JD of the HSW variety (Harvard-Stanford-Wharton) said "for the right opportunity, there's still capital. If the opportunity is big enough."

Medical Onshoring (patent-pending) is my mission in life. With a budget as large as the French economy, U.S. health care has plenty of assets to attract investors.

I decided to return full-time to health care for a lot of reasons. A key one: in technology, you get used to people, running into your office with their hair on fire, every other hour. At this stage of my life, I decided I needed to do something more meaningful and purposeful.

The meaning and purpose of MedOn (pat. pend.):

• to provide working people with affordable, high-quality medical-care options;

• try to help contain the frightening rise in medical-care costs; and

• raise the standard of medical care for working people, worldwide.

A lot better than people running around with their hair on fire, eh?

The need for accreditation: a cautionary tale

What goes around, comes around ..

Lawmaker Urges Regulation Of Dental Restorations To Protect Patient Safety

21 Feb 2008

Florida Rep. Stan Jordan, R-Jacksonville, announced that he has filed legislation backed by the Florida Dental Laboratory Association to implement more stringent regulations to protect patients receiving the dental restorations affixed into the mouths of millions of Americans each year.

Dental-restoration products - the porcelain crowns, dentures and bridges that American dental patients have permanently seated in their mouths - are currently under-regulated, with few legal requirements for technicians to be certified and no mandates for dentists to document or disclose the source of dental work to patients, Jordan said Tuesday.

Although dentists prescribe the type of device they need for a dental patient, the product is actually manufactured by a dental technician employed by a dental laboratory, which could be located in the United States or anywhere in the world. Due to the growing number of Americans seeking dental restorative treatment and the growing pressure by some dentists to cut costs and increase profit margins, much of the dental work Americans carry in their mouths is now imported from countries such as China, Pakistan, the Philippines and India.

Jordan's legislation, HB 923, will require all dental laboratories to disclose to dentists where a product was manufactured and what materials were used, and provide certificates of authenticity. It further requires dentists to include these records in a patient's dental chart so patients can request the information and so health officials can track and trace a dental restoration to its source should a health problem later emerge. Finally, the bill requires dental laboratory technicians to maintain continuing education every two years.