Wednesday, January 30, 2013
Monday, January 28, 2013
Name: KISS Destroyer
Brewery: KISSROCKDRINK Brewery. Yes, really.
Place Of Origin: Stockholm, Sweden
Type: Well the can says it’s the hottest beer in the world. At a pinch though, I’d guess it’s a lager.
Alcohol Content: 4.9%. Which is 4.9% more than Gene Simmons.
Why I Bought It: Because it’s a beer with KISS printed down the side! And so I could blog about it.
Taste: Oh god, it’s pretty dodgy. It actually reminds me of what beer was like when you were a teenager and hadn’t got used to the taste. Which probably says something about who this beer’s target market is.
What I did while drinking it: I wanted to [fill in blank] all night …
What I did after drinking it: … and [fill in blank] every day.
Saturday, January 26, 2013
Avengers: This is the best Avengers I’ve read in quite some time, probably since Mark Millar and Bryan Hitch’s alternate take on the team in ‘The Ultimates’. Jonathan Hickman is a ‘big ideas’ kind of guy, which makes him well-suited to what is meant to be the biggest, brashest Marvel title out there. Hickman has even taken the Avengers’ membership to absurdly large levels, packing almost 20 members into his line-up (I don’t disapprove of this concept, even if I think some of the choices are a bit weak). Really though, it’s Jerome Opena’s art that has me most keen about this book. He makes basically everybody he draws look kinda bad-ass; even douchebags like Sunspot and Sunfire. This is what the premier super-team in 2013 should be like. Verdict: Four fingers and a thumb.
New Avengers: Not quite sure about this one yet. Putting together the major movers and shakers in the Marvel Universe on one team is certainly an interesting idea, and Hickman’s proven he can write about a bunch of egotists on the excellent ‘Manhattan Projects’. Plus, I always like Steve Epting’s art (if I ever wrote ‘Avengers’, he’s be my first choice for penciller). But it may also end up reading like the minutes of a company board meeting. We’ll see. Verdict: Three fingers and a toe.
The Superior Spider-Man: Alright, anyone who cares probably knows this by now: in the ‘final’ issue of ‘Amazing Spider-Man’ (#700), Peter Parker’s mind was switched into the dying body of one of his greatest enemies, Doctor Octopus, leaving Doc Ock to carry on the Spider-Man legacy. Needless to say, Doc Ock doesn’t always have Parker’s sense of decency, even as he tries to be the ‘good guy’. It’s certainly a better and more interesting idea than when they replaced Peter Parker with his clone. However, while this isn’t bad, I’m not finding it essential reading. Verdict: Three fingers.
That wraps up my reviews, even though there a few more NOW! titles to be released. Of the remaining titles, Brian Wood’s all female X-Men looks the most intriguing, reminding me of the very first X-Men comic that I bought from my local milk bar back in the ‘80s* (in which Wolverine was the only male, and Rogue looked like she had popped out of a John Hughes flick**). Has Marvel NOW! been a success? Kind of – the unique cover designs seem to work well, and like DC’s ‘New 52’ a lot of the titles are more interesting than they were before the (ugh) relaunches. But in the end, I think it’s going to take a bigger creative and cultural shift than this for the general populace to see comics as anything more than a feeder for Hollywood blockbusters.
*For some arbitrary reason that only parents understand, my Mum forbade me to buy it, so I snuck out one weekend to plonk down my $1.30 and smuggled it back into the house so tightly you would’ve thought I’d just shoplifted it. Man, I was more bad-ass than Sunspot.
**Before I became a teenager, basically all of my ideas about what women aged 14-25 were like came from the X-Men and Degrassi Junior High.
Thursday, January 24, 2013
Tuesday, January 22, 2013
Some time ago I posted about a Taylor rule for Australia, which related the setting of interest rates to expected output and inflation. But another interesting question is what were the actual economic outcomes for Australia? More specifically, if you were to combine actual output and inflation figures into a single figure (an 'Economic Health Indicator' if you will), how has Australia's economic performance been tracking over time?
For now, just to see how such an indicator might work I've just looked at economic outcomes from 2001 to 2010. To construct the indiactor I used the following equation:
"EHI" for year x = a * "Normalised" output gap + b * "Normalised" absolute deviation of inflation from target inflation
So what's all this then?
Essentially, for any given year, the higher the output gap and the lower the absolute deviation of inflation from target inflation the higher is the "EHI".
By "normalise" I just mean that I've adjusted the outcomes for each year by subtracting the average for that outcome from 2001 to 2010, and dividing by the variation (i.e. standard deviation).
The output gap means how much actual output is above the economy's "potential output". (Some might argue that a higher output gap is not necessarily better, but I've assumed it is here.) For the output gap I have taken the figures from the International Monetary Fund website. (Some might
argue that these are a load of garbage, but I've assumed they are not.)
I have assumed target inflation is 2.5 per cent per annum, though that is not technically the Reserve Bank's target. By taking the absolute deviation I have assumed that it's a "bad" outcome if inflation is much higher than this figure or much lower than this figure (think Japan).
For "a" and "b" I tried a few different figures. First, I made them both 0.5, which gives both components equal weight. Then, I tried a=0.8, which gives more weight to the output gap component. Then, I tried a=0.2, which gives more weight to the inflation component.
Got it? Alright, let's see some results.
Monday, January 21, 2013
The Taylor rule is an equation that relates the nominal interest rate to inflation and output (Gross Domestic Product, or GDP). A forward-looking version of the rule could be expressed as follows:
Nominal interest rate = (Underlying) Inflation + Real neutral interest rate + a * (Expected (underlying) inflation - Target inflation) + b * Expected Output Gap
Now that the Reserve Bank of Australia has been publishing its output and inflation forecasts in its quarterly “Statement on Monetary Policy” since early-2008 I thought it would be an interesting nerdly exercise to see if you could relate the RBA’s setting of the cash rate to its output and inflation forecasts using the Taylor rule formula.
First, some assumptions
OK, there’s a lot of assumptions we have to make before we can put the rule into effect. First, we need to assume a value for the real neutral interest rate. The real neutral interest rate is, in theory, the value of the cash rate adjusted for inflation that means that monetary policy is neither expansionary nor contractionary. For those monetary policy newbies, a real interest rate below the neutral rate should tend to heat up the economy and raise output and inflation, while a real interest rate above the neutral rate should tend to slow things down. Understandably, the RBA has been reluctant to say what it thinks the value of the neutral rate is, but we can take an educated guess. A value of 3 per cent or more seems too high, given that the real cash rate has been lower than that for the majority of the “inflation targeting” era. In May 2011, when the cash rate was 4.75 per cent and underlying inflation was 2½ per cent, giving a real rate of 2¼ per cent, the RBA said that “this represents a mildly restrictive stance of monetary policy”. Then in November 2011, when the cash rate was reduced to 4.5 per cent and underlying inflation was 2½ per cent, giving a real rate of 2 per cent, the RBA said that “a more neutral stance of monetary policy was now appropriate”. Based on this, a real neutral interest rate of 2 per cent is good enough for me.
Next, how far in the future should we measure expected inflation and expected output? Gruen, Romalis and Chandra (1997) found that there was an average lag of about five or six quarters in monetary policy’s impact on output growth. So I’m going to assume that the RBA are looking at inflation and output five or six quarters out. Since they publish forecasts at six-monthly intervals, I’ll use the forecasts for five quarters out when those are available, and the forecasts for six quarters out when those are available.
Third, we need to calculate the expected output gap. The output gap is equal to real GDP less the level of real potential output (all divided by real potential output). Real potential output is the highest level of real GDP that can be sustained based on the supply of workers and capital and how productive they are; if real GDP is higher than real potential output than inflation tends to increase. Basically, if you can accurately work out what potential output is you’re an uber-nerd. I’m going to assume that potential output is growing at 3 per cent per year, and that it was less than real GDP back in early-2008 and about the same as real GDP in late-2011. This means that real GDP was expected to be well below potential output (i.e. the output gap was negative) during late-2008 and 2009 due to the effects of the global financial crisis and the resulting downturn in the world economy.
Fourth, I’m going to set target inflation at 2.5 per cent, the mid-point of the RBA's target band for inflation over the medium-term.
As mentioned above, I’m using underlying inflation figures rather than changes in the Consumer Price Index. Underlying inflation strips out the most volatile prices, and is therefore less affected by short-term movements (such as temporary rises or falls in petrol or food prices).
Finally, I’m setting a = 0.5 and b = 0.5, as John Taylor originally did.
So, the results ...
The graph below compares the actual cash rate from the March quarter 2008 to the November quarter 2011 with the cash rate as implied by my Taylor rule and my mangling of the RBA’s forecasts.
I don’t know - it doesn’t look too bad a fit to me ... I could probably make it fit a bit better by fiddling around with the potential output series, but I think you could characterise the RBA’s policy-setting as “Tayloresque”. There’s a bit of a difference around the global financial crisis era, but you could understand if the RBA wanted to be aggressive in cutting rates around that time.
It’s all a bit rough - I don’t imagine any major banks would be staking their millions on using this to accurately predict the RBA’s next move, but in a world of baffling economic models it’s always nice when you can use something simple to explain behaviour.
Wednesday, January 16, 2013
Monday, January 14, 2013
Saturday, January 12, 2013
Tuesday, January 8, 2013
2005 v WI – won chasing 182
2003 v ZIM – won chasing 172
Sunday, January 6, 2013
Yes, back in July last year I said I would not be posting anything about economics for a while. But circumstances have changed, and as my wife would say, now I can pontificate about economics to my heart’s content.
Back in its 2009-10 annual wage review decision, the Minimum Wage Panel of Fair Work Australia (now the Fair Work Commission) said that an increase in minimum (award) wages is likely to assist in promoting pay equity given the relatively high proportion of women among the award-reliant (para. 318). Actually, it turns out this isn’t likely to be true, and with a little bit of thought you can work out why. The ‘proof’ was presented in the final chapter of a 136-page(!!!) report that I got dragged into. But really the whole argument could have fitted onto a single sheet of paper*, as I’ll demonstrate below.
Assume that award wages are increased and nothing else changes.** Then the change in the overall gender pay gap will be close to the percentage of women that are award-reliant less the percentage of men that are award-reliant multiplied by the percentage increase in award rates of pay. In 2010, 17.5 per cent of adult women in Australia employed in non-managerial positions were award-reliant, compared to 12.2 per cent of men. So for a 1 percentage point increase in award rates of pay, the reduction in the difference in earnings between men and women is only about 0.04 percentage points. The overall gap in hourly earnings between men and women is over 10 per cent. So even an increase in award wages of 5-10 per cent is unlikely to make any significant dent in the gap in earnings between men and women. Now if, say, 90 per cent of women were reliant on awards, and only 10 per cent of men were, that would be a different story!
Note that this is a very different topic from whether Fair Work Australia/Fair Work Commission should adjust the pay rates of specific award-reliant employees so that award-reliant employees in female-dominated industries and award-reliant employees in male-dominated industries all receive equal pay for work of equal value. That’s an area where Fair Work Australia certainly does have an effect in removing pay disparities, because it controls the award rates. (See the equal remuneration order for the Social and Community Services award.)
*Not the Panel’s fault that it wasn’t, since it just picks the research topics, not how they’re carried through. In my view, many of the Minimum Wages Branch's research reports were way too long.
**Of course, other things will change, but it seems unlikely that any of them will change by enough to affect the general result. I’m also assuming here that the Minimum Wage Panel wouldn’t just change award wages for one gender!
Friday, January 4, 2013
1. Origins - Tennis
Natasha Khan’s ‘Laura’ is getting more plaudits, and while it’s a good song it’s a bit bare for my tastes. ‘All Your Gold’ recaptures the bells and whistles of Natasha’s ‘Two Suns’ album, but with somewhat of a spookier overtone.
Wednesday, January 2, 2013
Name: Genesis Dry Hopped Session Ale
Place Of Origin: Saratoga Springs, New York, US
Type: Session Ale. What is a Session Ale you ask? This article from Beeradvocate tries to explain it.
Alcohol Content: ? (But according to the article above, it must be less than 5%.)
Why I Bought It: If you think it’s for any other reason than the upside-down label, you’re underestimating how superficial I am. (Apparently the upside-down label is a mistake. Maybe I shouldn’t have recycled the bottle – it’s a collector’s item!)
Taste: Just an ordinary, lightish ale really; that’s not meant to sound like a bad thing.
What I did while drinking it: Watched the penultimate episode of Season 1 of ‘Girls’. What a great show, even if nobody drinks that much in it.
What I did after drinking it: Watched the final episode and dreamt of New York.