Archive for December 28th, 2015

Swiss to now vote for 100% reserve banking

December 28, 2015

Marc Thornton of Mises alerts me to this new Swiss referendum.

Post rejection of gold backed currency referendum, they are now looking at 100% reserve banking. What does this mean? Well, under this banks maintain all their demand deposits as reserves. As of now, they just maintain a fraction of deposits as reserves and lend the rest. This 100% rule shall limit banks role in creation of money which has increased significantly over the years. This restriction though does not usually apply to time deposits which are not payable on demand. Not sure what the details are of the proposed referendum.

So what is the new Swiss deal?

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Decline of West Indian cricket: A case of too much government intervention?

December 28, 2015

The West Indian cricket in many ways is like Japanese economy. Both peaked in mid-1980s and have just struggled ever since. Just that Japan has somehow maintained its stagnation levels but West Incies cricket keep finding new ways to decline further. One is waiting for a recovery which has become a perennial issue.

Tony Cosier has a piece on decline of WI cricket. He says that it was the govt which led to decline of the WI cricket and is also not allowing to recover (how often we hear and see that in economics too):

It is known that each of the three committees to review the board’s governance over the past eight years advised urgent change. The reports of the committees headed by former Jamaica prime minister PJ Patterson and St Kitts and Nevis Queen’s Counsel Charles Wilkin called for the reduction in the number of directors and the introduction of independents. The Barriteau report, the most recent, was presented in early November. It went further with its demand for the WICB’s dissolution and its eventual replacement by a significantly restructured board.

The WICB’s resistance was as predictable as Nanthan’s charge that the report was by “some CARICOM governments and their academic functionaries”, as he put it is his press interview. He accused governments of not supporting cricket in schools, ignoring the fact that the greats of West Indies cricket, from Headley to Sobers to Lara, needed no government funding to make them the players they became. The development of their vast talent came mainly through grounding at clubs. Since the 1960s, this has been augmented by the several state-appointed sports councils that provide coaches for schools.

Instead, Nanthan sought to place the WICB’s shortcomings at the feet of governments. In other words, the fall from glory to irrelevance was theirs, not the WICB’s.

He claimed it cost the WICB US$1 million to train a player from Under-15 to international level. If so, the question must be asked why so few have reached that standard over the past two decades while there has been a stream out of other countries, most recently Joe Root of England, Steve Smith of Australia, Virat Kohli of India and Kane Williamson of New Zealand.

Compare this to Aus and NZ openness to changing things:

The WICB’s approach is in direct contrast to the openness of Cricket Australia and New Zealand Cricket when confronted by comparable proposals for changes to their constitutions and their structures.

Australia, perennially a powerhouse of the international game, commissioned two independent assessors four years ago to review its board’s governance. It put the advice of the Crawford-Carter report into use, replacing state delegates with independent directors, who did not necessarily have strong cricket connections. It was a radical change, now generally regarded as a success.

Two years later New Zealand’s provincial associations unanimously approved a change to theirboard’s constitution, reducing its number of directors to eight, all independent. Since then, they have shot up from among the also-rans in the ICC rankings to mid-table. They are now a genuinely competitive force.

The difference is that Cricket Australia and New Zealand Cricket didn’t need governments to prompt them into action. They recognised the deficiencies of an outdated system and took action to change it. In spite of all the evidence, the WICB remains satisfied with the way it governs the game in a region of ten separate, independent governments, united only by a game that brought international recognition for excellence to the mini-states of the cricket Caribbean.

All this reads so similar to economics discussions..We see many simple economics ideas not moving as people are trying to protect their turfs and are hesitant to change..

Economics of egg business..

December 28, 2015

Interesting story on this new egg business in Madurai.  First, they are allowing hens to roam around free and then are mixing traditional knowledge which is helping raise healthier hens and eggs.

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