Now, finance theory, at least the one called the Modigliani-Miller theorem, argues that the market is basically indifferent to how a business is financed. Debt or equity, it matters not. If taxes are so high that I can’t save cash to reinvest in my business, it doesn’t matter, because if the expected return of investment in my business is greater than the cost of capital, the market will provide.

However, neither Modigliani nor Miller has been in contact with my banker, who seems unaware of financial theory. When we expanded our farm recently by purchasing a neighboring place, the lender required at least 35 per cent of the purchase price as a down payment. That would be cash. It mattered not the capital gains tax rate, the cost of capital, the expected return, or what Obama considers fair. Business is hard and cash is king.

Think warm weather. And, of course, Washington D.C.

Link via Instapundit.

Also: "Tech startups facing unexpected challenge: the government".

In terms of an academic lifetime, I'm still a relative newborn, yet I feel like I know a bit more about the frustration and exhaustion that might cause a college professor to wonder if he had wasted his life. I once received a paper wherein the student claimed that "John Lenin" had used his career in the Beatles as a stepping stone to seize control of Russia; last year, I read a paper that advanced the idea that "back in the day" — by which the writer meant the 1990s — people didn’t commit adultery, and homosexuality didn't exist.\

Mike Munger: "Can't Help It: Majorities Suck".

Majorities suck. Why would anyone expect to find rectitude in the multitude?

And if we don't trust majorities to choose morality / religion / restrictions on speech for the rest of us, why would anyone trust voters to pick the right candidate? After taking these abuses, I'm warming to the Electoral College. It recognizes the importance of states in the Constitution, it increases motives for participation in battleground states, and it gives voters in small states more of a say. Sure, there are good arguments against the Electoral College, but just saying that "majorities should always get their way" means you need to go back to school.

The US is not a democracy. We don't trust majorities, because of stupid stuff like slavery and the Alien and Sedition Act, and the Patriot Act, and Prop 8. There is nothing special about the majority will, it's just what most people happen to believe.

Ross Douhat: "Catholics, Conscience and Contraception".

The logic that he’s applying to orthodox Catholics could be applied just as easily to the Amish, the Jehovah’s Witnesses, Orthodox Jews, and a host of other groups that don’t have the kind of institutional resources that Roman Catholicism can muster in its own defense. Yes, sometimes state interests are compelling enough to trump religious liberties, and defenders of this mandate have every right to make that case. But the argument that the state’s interests can trump religious liberties so long as the group of people being asked to violate their consciences is small enough is not an argument at all. It’s just a raw appeal to power.

From a public choice standpoint, however, if the modern social democratic state is the major source of special interest power then by far the most effective way to reduce this power would be to dismantle the apparatus of anti-competitive intervention in markets. This does not require an egalitarian fantasy land where all inequality is abolished. Rather, it requires a framework of limited government where inequalities which reflect superior performance and entrepreneurial ingenuity are welcomed but where those that reflect the power of crony capitalists, crony union bosses and public sector bureaucrats are reduced to a minimum.

So if Svensmark is right, lower solar radiation means more cosmic rays, more clouds, and a cooler Earth, while higher solar radiation means fewer cosmic rays, fewer clouds, and a warmer Earth.

Those who have followed the global warming controversy over the years may recall that cloud-formation is one of the major gaps in the computerized climate "models" used by the consensus scientists to predict global warming. They have never had a theory to explain how and why clouds form or to account accurately for their effect on the climate. Svensmark has smashed through this glaring gap in their theory.

And if Larry won, we'd probably get the bonus of having my old boss, Ed Leamer, be Secretary of the Treasury. A Bayesian econometrician in the Cabinet would have to be good, right?

No, buy. Buy! "The cash conundrum revisited".

I'd like to borrow you overnight and then hold you to maturity.

Roses are red, violets are blue, thank you for Twist and, of course, QE2!

Hey baby, we're too big to fail.

When I get that feeling I want quantitative easing. [Ed. note: Marvin Gaye, call your office.]

Link via Carpe Diem.

John Podhoretz takes this goofy complaint down hard. 

I fondly remember my days as an undergraduate at the University of Wisconsin-Madison some three decades ago. During my time at Madison, I never saw an advisor. The course catalog would be delivered in bulk to Memorial Union (and other locations) and the university assumed that their adult students could make their own decisions about courses, the coherence of their schedules, and the number of courses they wanted to take in any given semester (if it took you longer to graduate than the standard four years, it was your problem). The one year I lived in university housing (a cooperative), I slept in a bunk bed in a cement block room with one window.  The food was rather bland—lots of starch, little in the way of protein—and you had your choice of milk or water (things were a little better in the dorms, but not much). Since no one owned televisions, if you wanted to watch TV you went to a commons area or hit a bar. If you wanted to exercise, you went to a gym that was equipped with an assortment of old steel benches, iron weights, punching bags, and stationary bikes.

Can you imagine?

UPDATE: link fixed now. Thanks to all those who notified me.

Great, just great.

Link via Instapundit.

The best was the shot of a very proud dad and sister. More here.

Wail, Ms. Florence, wail.

At times, watching the film is like watching the ultimate American nightmare. It can be hard to believe it’s a documentary. . . .

“We love our magic bullets,” says Ewing, who is originally from the city, “but it’s not going to be a magic bullet that saves Detroit.”

Two:

The massive abandonment has invidious, far-reaching effects for the Detroiters who remain. Over the last year, there have been an average of 35 major fires a day in the city.

1. Interplanetary travel is waiting at your front door — C.O.D. It's yours when you pay for it. . . . 

12. Intelligent life will be found on Mars.

My school has two full-time police officers, a full-time probation officer and several full-time security personnel to handle about 3,800 students. Yet we still have a hard time keeping kids from smoking pot on a regular basis in our restrooms.

Today's teacher must be highly skilled in her subject matter just to make it into the classroom, more so than at any other time in the history of education. She also must play the role of parent, custodian, psychologist, drug and alcohol interventionist and parole officer, to name a few.

On a recent Wednesday, my second-period class was interrupted by a student who overdosed on alcohol and Ecstasy and nearly died. Earlier in the year, one of our students was shot in the face and hospitalized. Last year, a student was shot in the neck and paralyzed for life; one of my students was standing next to him when it happened. The year before that, one of my students was inside her house when her sister, sitting in a car outside, was shot and blinded in one eye in a gang drive-by. The baby she was holding was struck by a bullet and killed.

Worst of all? The teacher doesn't work in downtown L.A. or South Central. She teaches in Reseda. Dude, that's the Valley!

It's fashionable to blame a lack of access to good food for America's lousy eating habits. It may be easier to plunk down a new Walmart in the inner city. (And the schemes may also help cash-starved politicians generate corporate campaign contributions.) But the Cooking Matters survey is more evidence that helping families to eat better is a lot more complicated.