Sunday, April 27, 2008

Economics Articles Today

Seems to be a big day for economics.

Roger Lowenstein has a very interesting article in the NY Times Mag on companies like Moody's which rated the securities backed by pools of mortgages. It's even clear enough for a codger to understand. What struck me was the play of wits between banks and rating agencies--banks want to get the highest rating for a mix of mortgages, so they game the system and the rating agency may or may not catch them. Then people got sucked into assuming the future would look like the past, which it didn't.

Tyler Cowen has a column in the Times arguing that free trade in rice would help everyone. I normally like his writing, but this was confusing to me. See for yourself.

And Anthony Faiola has the first article in a Post series called "The New Economics of Hunger". I liked it for its even-handedness, but especially for the graphics in the print edition. The most space was devoted to the comparative imports and exports of grains by world region (clue--North America exports the majority of the world's grain). But only in the area of 10 percent of each grain is traded, most is grown and consumed in the same country.

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