L.A. Times reports that the housing situation in China is really dire…

“Fine Gael leader Kenny, 59, said this week his priority will be to renegotiate the 5.8 percent interest rate on the bailout. The party has said it may seek European agreement to share the burden of rescuing the country’s financial system with senior bank bondholders.

EU Economic and Monetary Affairs Commissioner Olli Rehn said on Feb. 15 there is “no appetite” for imposing losses on senior bondholders at Irish banks.”

This is key. There are only three ways out of it.
1. Ireland pays 5.8% (not likely)
2. EFSF (or whatever) accepts renegotiated (lower) rate (likely, but listen to Germany)
3. Senior bondholders (mostly other European banks?) take a hit on loans to Irish banks. (unlikely)

An international study was just published that looked at reading, math and science skills of 15 year olds in 65 countries.  It may be shocking for Russians to realize, but Russia was below average in ALL categories (yes, that includes math).  On reading we did about as well as Turkey (where many Russians travel for vacations, and whom they probably don’t consider an especially educated nation, despite rich history).  On math and science we did worse than Portugal (also below OECD average).  Schools emphasizing Confucian ethics (Shanghai, Singapore, South Korea) were leading the rankings.

Some would attribute this decline to the change in cultural values (education cannot be valued in a country, where most people achieve success by navigating social connections and placing themselves in rent-generating positions (see rent seeking)).  There is some of that.  But also, the World kept moving forward while Russia was asleep. 

See rankings here:

http://www.oecd.org/dataoecd/54/12/46643496.pdf

Executive summary:

http://www.oecd.org/dataoecd/34/60/46619703.pdf

http://www.nytimes.com/2011/01/16/magazine/16Europe-t.html

Fancy a career of a lawyer?  The bar exam is not what you should fear, you should fear graduating without a job.  Apparently a lot of students do, especially from second and third tier schools.  Loaded with student debt, unable to find decent employment, angry about false advertising by law schools about how rosy their employment prospects would be, more and more graduates moonlight in dead end jobs…

http://www.nytimes.com/2011/01/09/business/09law.html

The price tag is so high because conducting a clinical trial in the US is costly (you need to pay the doctors to administer whatever drug you came up with).  One idea to minimize the cost of testing new drugs is to test them where you don’t have to pay to doctors so much (like India).  Even more significant is the fact that many patients there can’t afford standard treatment drug, so you can offer them experimental drug for free and they may be better off (on average) than with no drug at all (current state).  Now, to some this may sounds distasteful – using people as guinea pigs, but consider the alternative – current state – where people do not receive ANY medicine…

Another issue is the profit motive.  Since pharma needs those tests and is ready to pay for them it presents an opportunity to entrepreneural spirits to offer these sorts of arragements.  This is the outsourcing of clinical trials.

Ethical dillemmas abound.  No country wants to be known as a dump for Big Pharma to test experimental drugs on their own citizens.  But is it really that bad, given that their citizens get no help at all now (in most cases)?

Well, here’s the article from Vanity Fair by two Pulitzer-prize winning journalists on the topic.   I will read it soon.

http://www.vanityfair.com/politics/features/2011/01/deadly-medicine-201101

“Another day, another record yield on Irish 10-year debt – now at 7.6%. Ireland is fully funded until April.”

One receives full benefits at the age of 67 (although that may change). 

How are your benefits calculated?

Well, you get pretty much dollar for dollar on your first $10k of income (90% of $790/mo).  After that its peanuts – you get 32% for each additional dollar of salary (and then even less).  The “typical” salary is calculated by taking average of your best 35 years of employment (adjusted for inflation).  So this means to get maximum return on your social security payments you need:

Either work 35 years with at least $10k of income (adjusted for inflation), OR

work at least 10 years with about $60k of income (to get about the same average wage (NB: it’s more than 3.5x since there are some rules..)).

This will get you about $700/mo of social security payments.  

Also, note, you don’t have to be a US citizen to receive social security benefits, as long as you’ve paid into the system.  But the rules are a bit complicated.

And it is clear this happens. We trade electronically at our fund. We were recently trading in a stock with a large spread. I have changed the numbers so as not to identify the stock – but the ratios are about right. The bid was about 129.50, offer was about 131.50. We did not want to cross the spread – so when we bid for the stock we bid $129.55. Within a second a computer (possibly at our own broker but it makes no difference which broker) bid $129.60 for a few hundred shares. We fiddled for a while changing our bid and watching the bot change theirs. We would have loved to think we were frustrating the computer – but alas it was just a machine – and we were people up late at night.

http://www.businessinsider.com/sorry-goldmans-mega-profits-didnt-come-from-high-frequency-front-running-2009-7

http://www.datacenterknowledge.com/archives/2009/07/24/nytimes-examines-low-latency-trading/

They try to deterine whether it was 600,000 or 640,000 (quoting administration).  Well, since the stimulus bill cost the tax payers $787 billion, this means that in both cases each job created by the bill cost the government over a cool $1 million dollars!  Wait, it gets worse.  After all this wasn’t charity.  We didn’t just write 600,000 $1 millon dollar checks! Nooo, that would be socialism! We created A JOB!  But if that’s the case, what goods and services were created?  Who paid for them?  And if they did, shouldn’t we get the receipts and recoup our money back?  It would be cheaper to write 15 million (!) $40,000 checks (enough to cover everyone who is unemployed!)…

P.S. For the wonkish types.  You will tell me that it’s too simplistic.  At least one third of the bill were tax cuts.  Yes, but wasn’t their sole purpose to create more jobs?  On this measure this whole thing is clearly bonkers!  From the left, you’ll tell me that part of the bill was to extend the unemployment benefits, so the bill was doing precisely was I am advocating here.  True, but then why all the talk about creating and saving jobs???  I’m just asking for some honesty here…