Proof that Americans are more smart than those other dopes

from the New York Times

In the early 1980s "the A&W restaurant chain released a new hamburger to rival the McDonald’s Quarter Pounder. With a third-pound of beef, the A&W burger had more meat than the Quarter Pounder; in taste tests, customers preferred A&W’s burger. And it was less expensive. A lavish A&W television and radio marketing campaign cited these benefits. Yet instead of leaping at the great value, customers snubbed it.

"Only when the company held customer focus groups did it become clear why. The Third Pounder presented the American public with a test in fractions. And we failed. Misunderstanding the value of one-third, customers believed they were being overcharged. Why, they asked the researchers, should they pay the same amount for a third of a pound of meat as they did for a quarter-pound of meat at McDonald’s. The “4” in “¼,” larger than the “3” in “⅓,” led them astray."

Is the US the most literate nation on earth?

According to CNBC, the USPS delivers 43% of all mail delivered in the world.

It's a drag

Greece's public sector wage bill has fallen from €24 billion in 2009 to €16 billion in 2013, according to today's FT. Now that's what I call austerity!

Good news from the Duchy of Grand Fenwich

The IMF calculates that Luxembourg receives one tenth of the world's foreign direct investment, through "letter box corporations." The fees on this flow make it the richest country in Europe. Now the former pm is now to become the president of the European Commission. One comment of a tax specialist: "This isn't a poacher turned gamekeeper, it looks more like the poacher in charge of the gamekeepers."

Is China about to hit a wall?

China's debt/gdp has risen from 147% at the end of 2008 to 251% at the end of June. The US and the UK are 280% and Japan is 415%. What would be China's growth rate were the ratio to be stable rather than rising?

The very best hypocrites always sound sincere

EU has failed to add to Russian sanctions following the airplane disaster, despite a push by the UK, which was criticized by Jean-Christophe Cambadelis, head of the French Socialist Party, who said, "This is a false debate waged by hypocrites.  When you see how many [Russian] oligarchs have sought refuge in London, David Cameron should start by cleaning up his  own back yard." (In the FT today)

Henry Kaufman says the business cycle is dead

Henry Kaufman (remember him? Dr Doom of the 1970s?) wrote an oped in the FT yesterday, "Markets and the Fed have to practise a new dance," suggests that we might not see economic cycles in the future, but "selective intervention" by the Fed. I suppose he means, although does not explicitly say, that business cycles will be replaced by carefully modulated boom and bust cycles. Puzzling it is, both what he means and why he wrote this essay.

I wonder if we should welcome a replacement of normal market forces with Fed decision-making.