Fixed Income Price Quotes

The first people to get the new money are the counterfeiters, which they use to buy various goods and services. The second receivers of the new money are the retailers who sell those goods to the counterfeiters. And on and on the new money ripples out through the system, going from one pocket or till to another. As it does so, there is an immediate redistribution effect. For first the counterfeiters, then the retailers, etc. have new money and monetary income they use to bid up goods and services, increasing their demand and raising the prices of the goods that they purchase. But as prices of goods begin to rise in response to the higher quantity of money, those who haven't yet received the new money find the prices of the goods they buy have gone up, while their own selling prices or incomes have not risen. In short, the early receivers of the new money in this market chain of events gain at the expense of those who receive the money toward the end of the chain, and still worse losers are the people (e.g., those on fixed incomes such as annuities, interest, or pensions) who never receive the new money at all.

Loss aversion refers to the relative strength of two motives: we are driven more strongly to avoid losses than to achieve gains. A reference point is sometimes the status quo, but it can also be a goal in the future: not achieving a goal is a loss, exceeding the goal is a gain. As we might expect from negativity dominance, the two motives are not equally powerful. The aversion to the failure of not reaching the goal is much stronger than the desire to exceed it. People often adopt short-term goals that they strive to achieve but not necessarily to exceed. They are likely to reduce their efforts when they have reached an immediate goal, with results that sometimes violate economic logic. New York cabdrivers, for example, may have a target income for the month or the year, but the goal that controls their effort is typically a daily target of earnings. Of course, the daily goal is much easier to achieve (and exceed) on some days than on others. On rainy days, a New York cab never remains free for long, and the driver quickly achieves his target; not so in pleasant weather, when cabs often waste time cruising the streets looking for fares. Economic logic implies that cabdrivers should work many hours on rainy days and treat themselves to some leisure on mild days, when they can “buy” leisure at a lower price. The logic of loss aversion suggests the opposite: drivers who have a fixed daily target will work many more hours when the pickings are slim and go home early when rain-drenched customers are begging to be taken somewhere.

Poultry workers are paid very little: in the United States, two cents for every dollar spent on a fast-food chicken goes to workers, and some chicken operators use prison labor, paid twenty-five cents per hour. Think of this as Cheap Work. In the US poultry industry, 86 percent of workers who cut wings are in pain because of the repetitive hacking and twisting on the line. Some employers mock their workers for reporting injury, and the denial of injury claims is common. The result for workers is a 15 percent decline in income for the ten years after injury. While recovering, workers will depend on their families and support networks, a factor outside the circuits of production but central to their continued participation in the workforce. Think of this as Cheap Care. The food produced by this industry ends up keeping bellies full and discontent down through low prices at the checkout and drive-through. That's a strategy of Cheap Food....You can't have low-cost chicken without abundant propane: Cheap Energy. There is some risk in the commercial sale of these processed birds, but through franchising and subsidies, everything from easy financial and physical access to the land on which the soy feed for chickens is grown to small business loans, that risk is mitigated through public expense for private profit. This is one aspect of Cheap Money. Finally, persistent and frequent acts of chauvinism against categories of animal and human life -- such as women, the colonized, the poor, people of color, and immigrants -- have made each of these six cheap things possible. Fixing this ecology in place requires a final element -- the rule of Cheap Lives. Yet at every step of this process, humans resist....

What American Healthcare Can Learn from Italy: Three Lessons It’s easy. First, learn to live like Italians. Eat their famous Mediterranean diet, drink alcohol regularly but in moderation, use feet instead of cars, stop packing pistols and dropping drugs. Second, flatten out the class structure. Shrink the gap between high and low incomes, raise pensions and minimum wages to subsistence level, fix the tax structure to favor the ninety-nine percent. And why not redistribute lifestyle too? Give working stiffs the same freedom to have kids (maternity leave), convalesce (sick leave), and relax (proper vacations) as the rich. Finally, give everybody access to health care. Not just insurance, but actual doctors, medications, and hospitals. As I write, the future of the Affordable Care Act is uncertain, but surely the country will not fall into the abyss that came before. Once they’ve had a taste of what it’s like not to be one heart attack away from bankruptcy, Americans won’t turn back the clock. Even what is lately being called Medicare for All, considered to be on the fringe left a decade ago and slammed as “socialized medicine,” is now supported by a majority of Americans, according to some polls. In practice, there’s little hope for Italian lessons one and two—the United States is making only baby steps toward improving its lifestyle, and its income inequality is worse every year. But the third lesson is more feasible. Like Italy, we can provide universal access to treatment and medications with minimal point-of-service payments and with prices kept down by government negotiation. Financial arrangements could be single-payer like Medicare or use private insurance companies as intermediaries like Switzerland, without copying the full Italian model of doctors on government salaries. Despite the death by a thousand cuts currently being inflicted on the Affordable Care Act, I am convinced that Americans will no longer stand for leaving vast numbers of the population uninsured, or denying medical coverage to people whose only sin is to be sick. The health care genie can’t be put back in the bottle.

The wit of man,” said Democratic Congressman George Pendleton of Ohio, “has never discovered a means by which paper currency can be kept at par value, except by its speedy, cheap, certain convertibility into gold and silver.” If this bill passed, “prices will be inflated . . . incomes will depreciate; the savings of the poor will vanish; the hoardings of the widow will melt away; bonds, mortgages, and notes—everything of fixed value—will lose their value.

It’s importance, however, is bigger than that. Treasury securities are the risk-free yield curve for all of the financial markets. That’s right, the yields of Treasury Bills, Notes, and Bonds from overnight to 30 years make up a yield curve that is used to price all other fixed-income securities. The Treasury market is the reference rate for interest rates. Treasurys are a tool for pricing corporate bonds, municipal bonds, emerging market bonds, federal agencies, mortgage-backed securities, and other dollar assets. On top of that, they’re also a tool for speculation and hedging risk.