Be wary of economic forecasts

David MoonBlog

If a group of the country’s leading economists can’t even come close to forecasting the near-term health of the U.S. economy, you don’t have a chance of consistently guessing accurately. And whether you stick your finger in the air or rationalize your forecasts with reems of data and massive spreadsheets, a short-term economic forecast ultimately is little more valuable than the toss of a coin. A year ago, the consensus among experts was that higher interest rates would push the U.S. into a recession in 2023. The WSJ experts placed the probability of recession last year at 61%, a historically … Read More

Some thoughts on college football and NIL

David MoonBlog

The three college athletes expected to have the highest estimated 2023 earnings are Lebron James’ son, Deion Sanders’ son and Livvy Dunne, a gymnast at LSU. Dunne is estimated to earn $3.5 million annually for her various Name, Image and Likeness (NIL) agreements. LSU women’s basketball player Angel Reese is 9th on the NIL list, earning an estimated $1.7 million in 2023. (The average WNBA player’s salary is $113,000.) If you don’t like the anarchy version of college football, don’t blame NIL. Angel Reese’s earnings didn’t ruin anyone’s enjoyment of her team’s 26-6 season last year. Don’t even blame the … Read More

Most dangerous risk usually unexpected

David MoonBlog

I don’t know what should worry you most as we enter 2024, but I suspect that for most people, it’s not the thing that most worries them. I conducted an incredibly non-scientific survey of a couple hundred friends, asking them what three things worry them most about 2024. Although I was hoping for non-political responses, I intentionally included a couple of quasi-socialist University of Tennessee professors and local attorney/political commentator Don Bosch to balance my predictable circle of east Tennessee conservatives. The answers almost all fell into one of four general categories: the economy, politics, healthcare or a general decay … Read More

The miracle of birth and possibilities

David MoonBlog

The older I get the more recent historical events seem to be. When I was a kid, World War II felt like something that occurred seemingly centuries earlier – back when things were in black and white. But I was born less than 20 years following the war’s end. My kids were born 23 years ago – that’s a drop in the bucket in terms of time. Yet, 23 years before I was born, England was rationing food and the U.S. began distributing the first Social Security checks. A couple of weeks ago, I met a 105-year-old woman from Kentucky. … Read More

Artificial EV demand outpaces infrastructure

David MoonBlog

A friend of mine rented a car a few weeks ago to drive from Nashville to Knoxville. The rental car agent assured easily sold her on the Kia EV6 electric vehicle (EV), explaining that it had a range of 310 miles, was fully charged and would easily get her the 160 miles to west Knoxville that evening. What the employee of this unnamed rental car company (rhymes with “squirts) did not explain, however, was that driving up the Cumberland Plateau would significantly diminish the battery efficiency. This 25-year-old young woman ended up stranded along I-40 in the middle of the … Read More

How much more money buys happiness?

David MoonBlog

I received a Christmas card last year that depicted a little boy writing a letter to Santa. “Dear Santa, I won’t mind if I don’t get what I want for Christmas so long as no one else does! Timmy.” I think young Timmy understands the relationship between materialism and happiness better than most social scientists. That is, what you have matters less than what you think you should have. Imagine that you lived in a house a third smaller than your current home, didn’t have air conditioning, ate fewer than one restaurant meal a month, didn’t have television and your … Read More

Thanksgiving week irritants

David MoonBlog

Rather than bore you with another syrupy Thanksgiving week column about gratitude, here is an extremely abbreviated list of things that irritate me this year. Bacon packaging, potato chip bags and ice cream so solidly frozen that it bends my spoon. Restaurant menus longer than 4 pages. People who leave 5 seconds on the microwave timer. TV meteorologists who say, “looks like we’re in for some weather tonight.” We always have weather. People who complain about the end of Daylight Savings Time “robbing” them of an hour of daylight. Just get up an hour earlier. People who are habitually late, … Read More

Don’t rush into permanently closing Gay Street

David MoonBlog

The city of Knoxville recently announced a four-weekend partial closure of Gay Street, prohibiting vehicles between Wall and Union Avenues. This is supposedly a feasibility test, studying the creation of a more pedestrian-friendly city, less predominated by cars and roads. If you like the revamped Cumberland Avenue, you will love closing Gay Street. We close downtown streets all the time for very popular special events, such as the USA CYCLING National Championships. Those are fantastic. For years, the city closed essentially all of Gay Street and a number of other downtown streets for an evening called “Saturday night on the … Read More

SBF fraud trial entertaining, educational

David MoonBlog

It was fascinating drama when accused crypto-fraudster Sam Bankman-Fried took the stand in his trial this past week, but it also provided some pretty useful reminders about investing, decision-making and human behavior in general. After spending years intentionally crafting the illusion of an eccentric genius and hands-on business mogul, the 31-year-old Bankman-Fried spent his first day of testimony describing how he relied on others to make the critical decisions about risk management and investor protections. Under cross examination the next two days, the boy wonder responded to most questions with a variation of “I don’t remember.” Bankman-Fried is the only … Read More

Incentives drive trade and economic decisions

David MoonBlog

Business schools teach our future leaders of industry that countries should engage in trade with partners that have lower opportunity costs to produce specific goods and services. That is, standards of living will increase in both countries when the U.S. imports sneakers from Indonesia and exports soybeans to the country. I believed this economic theory for years, mostly blindly accepting one important assumption: decision-makers in each country seek to maximize overall wealth and living standards in each country. That’s the theory, anyway. And it’s mostly true most of the time. But it is definitely not always true all of the … Read More