Larry Kudlow is a crank...but I kind of like him!

On the Jan 31st Kudlow and Company on CNBC, Larry Kudlow, remarking on John McCain’s comments on Wall Street companies that helped cause the sub-prime disaster, shouted that “70% of the bad loans were because people lied on their applications! Why does John McCain hate Wall Street so much?” After the commercial, he asked Bob Shrum, “Why do the Dems hate corporations so much?”

As Ed Norton would say, “Jeez , what a grouch.”

Freakonomics on Education

In his book Freakonimics, Steven Levitt explodes many myths supported by “conventional wisdom”. Of great interest to educators is his analysis of the data in the U.S. Department of Education’s Early Childhood Longitudinal Study (ECLS). According to the ECLS data, eight factors show a strong correlation (either negative or positive) with test scores, while eight other factors don’t seem to matter. See if some of these go against what you currently believe:

1. Matters: The child has highly educated parents.
Doesn’t: The child’s family is intact.

2. Matters: The child’s parents have high socioeconomic status.
Doesn’t: The child’s parents recently moved into a better neighborhood.

3. Matters: The child’s mother was thirty years old or older at the
time of the birth of her first child.
Doesn’t: The child’s mother didn’t work between birth and
Kindergarten.

4. Matters: The child had low birthweight.
Doesn’t: The child attended Head Start.

5. Matters: The child’s parents speak English in the home.
Doesn’t: The child’s parents regularly take him to museums.

6. Matters: The child is adopted.
Doesn’t: The child is regularly spanked.

7. Matters: The child’s parents are involved in the PTA.
Doesn’t: The child frequently watches television.

8. Matters: The child has many books in his home.
Doesn’t: The child’s parents read to him nearly every day.

We want to Run it like a Business...

So...if you crash and burn on Wall Street, you get a raise!

As an educator living under the Joel Klein era , this really opens my eyes. Mr. Klein and Mr. Bloomberg steamrolled over the Board of Education, smashing the old apparatus of doing the business of education. Some of the changes were good, many not so good. They have tried to privatize or "pseudo-privatize" (i.e., asked their high-priced lawyers how to privatize the system as much as possible and destroy the teachers' union without actually appearing to do so) many elements of the education system. They contend that the education system should be "run like a business", with leaders and teachers being held "accountable".

But, as we see in this New York Times article from January 27, 2008 (see below), the men who lost BILLIONS in the sub-prime debacle of the past few years are being courted by other corporations who are simply throwing money at them! If we carry this out to its (il)logical conclusion, those principals and teachers who received a "D' or an "F" on the school progress report should be fired and then rehired at other schools, with a big raise. After all, we want it to run "like a business..."

http://www.nytimes.com/2008/01/27/business/yourmoney/27kim.html?em&ex=1201669200&en=70bd49bff50909f2&ei=5087%0A

New York Times
What’s $34 Billion on Wall Street?
By LANDON THOMAS Jr.
Published: January 27, 2008

UNDER the stewardship of Dow Kim and Thomas G. Maheras, Merrill Lynch and Citigroup built positions in subprime-related securities that led to $34 billion in write-downs last year. The debacle cost chief executives their jobs and brought two of the world’s premier financial institutions to their knees.
In any other industry, Mr. Kim and Mr. Maheras would be pariahs. But in the looking-glass world of Wall Street, they — and others like them — are hot properties. The two executives are well on their way to reviving their careers, even as global markets shudder at the prospect that Merrill and Citigroup may report further subprime losses in the coming months.
Mr. Maheras, who left his job as co-president of Citigroup’s investment bank this fall after being demoted, has had serious discussions with several investment banks, including Bear Stearns, about taking on a top management position, people who have been briefed on the situation said. And he has also been approached by investment firms willing to back him to the tune of $1 billion or more if he decides to start his own hedge fund, these people said.
Mr. Kim, who until this spring was a co-president at Merrill Lynch with oversight of the firm’s trading and market operations, has been crisscrossing the globe in recent months raising money for his new hedge fund, Diamond Lake Capital.
The ease with which Mr. Maheras and Mr. Kim have put themselves back in play is a reminder that for many top Wall Street executives, humiliation and defeat need not result in a professional exile. And they aren’t the only ones. Zoe Cruz, the Morgan Stanley co-president who was forced to leave her job after $10.8 billion in subprime losses, has been approached by investment banks, hedge funds and private equity funds about a senior management role, people briefed on those discussions say.
“It is always an assumption on Wall Street that it is not the individuals that lose money; it’s the system,” said Charles R. Geisst, a Wall Street historian and a finance professor at Manhattan College. “You can fail big time, but you can also succeed big time.

“They think it’s bad luck,” he said, so the attitude is “let’s give them another chance.”