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October 23, 2007
Why Were Year 2006 Subprime Mortgages So Different?

This is not a question I have a good answer for. Tyler Cowen posts a link to a paper from an NYU Economist and a Federal Reserve banker analyzing the last 5 years of subrprime loan performance.

What's so odd is that vintage 2006 subprime loans went delinquent and are foreclosing much faster than any other earlier year without a very clear reason why. This was happening while lenders were recognizing that high loan to equity borrowers were a larger risk and were raising pricing accordingly (but probably not enough.) Variable rate loans and low document loans don't actually seem to be the issue that drove the changes either.

I'm going to be very interested to see what explanation can be found as more look into this.

Posted by hoffmang at 09:11 PM

October 15, 2007
AB-1471 (Microstamping) May Never Be Implemented

Quite a stir was caused over the weekend when Governor Schwarzenegger signed AB-1471 which will require semiautomatic handguns to have microstamping starting in 2010.

However there is a really interesting line in the bill that reads, "provided that the Department of Justice certifies that the technology used to create the imprint is available to more than one manufacturer unencumbered by any patent restrictions." Right now one company (ID Dynamics) claims the patents (7111423 and 6886284 amongst others) to microstamping spent shells in firearms and subsequently reading them. Those patents are valid until about 2023 and I'm quite sure that Mr. Lizotte and Mr. Ohar claim that their patents occupy the entire field of firearm microstamping. Further, there are probably quite a few other patents in the lithography field that this core technology may infringe. Since the legislature required that the technology not be encumbered by patent I doubt that California DOJ can complete an OAL rulemaking that conforms with the legislation and patent law before the expiration of ID Dynamic's patents around 2023.

Posted by hoffmang at 07:30 PM

Actual Income Tax Data

There is an abundance of ill informed argument on who is paying what portion of personal income taxes in the US. I think this chart adds a whole lot of actual perspective to who is paying what and how progressive our system is:

What that says to me is that our tax system is doing what we want it to do and as the current budget deficit narrows, we have no real need to raise taxes anywhere across the board.

Thanks to Glenn Reynolds, and Greg Mankiw (and their sources) for sharing this data set.

Posted by hoffmang at 05:43 PM

October 05, 2007
Alan Gura Responds to DC's Cert Petition

Gura, Levy, and team responded to DC's petition for certiorari this week. Their blog post is here and the actual filing is available here.

Some of my favorite sections:

A century earlier, the infamous Dred Scott case reasoned that no Southern state would have adopted a constitution obligating it to respect privileges and immunities of citizenship held by African-Americans, including "the full liberty of speech in public and in private upon all subjects upon which its own citizens might speak; to hold public meetings upon political affairs, and to keep and carry arms wherever they went." Scott v. Sandford, 60 U.S. 393, 417 (1857).
While Scott's odious holding is an aberration, its recognition of the fact that citizens enjoy a personal right to keep and bear arms certainly was not.

And in response to DC's argument that it need not stand by while its citizens die:

Petitioners correctly note that the Second Amendment "does not require the District to stand by while its citizens die." Pet. at 30 (emphasis added). Yet the city consistently fights to secure its right to stand by while its citizens are victimized by crime. For example, the city has successfully defended its right to "stand by while its citizens" are raped, kidnapped from their homes, and further abused. Warren v. District of Columbia, 444 A.2d 1 (D.C. 1981) (en banc). The city has likewise successfully defended its right to "stand by" in the face of the worst urban rioting in our nation's history. Westminster Investing Co. v. G.C. Murphy Co., 434 F.2d 521 (D.C. Cir. 1970).
The city has even defended its right to "stand by while its citizens die" when the perpetrator is a police officer. Morgan v. District of Columbia, 468 A.2d 1306 (D.C. 1983) (en banc). Indeed, the city has asserted its right to "stand by while its citizens die" in the course of volunteering their assistance to the police. Butera v. District of Columbia, 235 F.3d 637 (D.C. Cir. 2001).
Posted by hoffmang at 07:31 PM

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