Monday, March 7, 2016

The Money Cost Of War

Lifted in toto from Futility Closet:

Late Service
The U.S. Department of Veterans Affairs is still paying a pension earned by a Civil War soldier.

Union infantryman Mose Triplett was 19 at the war’s end in 1865. In the 1920s he married a woman nearly 50 years his junior, and they had a daughter, Irene, in 1930, when Mose was 83 and his wife was 34.

Irene Triplett, now 85 years old and the last child of any Civil War veteran still on the VA benefits rolls, lives today in a nursing home in Wilkesboro, N.C. She collects $73.13 each month through the pension her father earned for her in 1865.

(Thanks, Tom.)
Futility Closet home

One of the few economists who we think is actually worth a damn, William Nordhaus at Yale, predicted in 2002 that the cost of the looming Iraq war would be as much as $2 trillion. This at a time when most economists were talking an eighth or a sixth of that figure.

Well, now it looks as though the all-in costs will be around $3 trillion, if Joseph Stiglitz's abacus is to be believed. So although off by a trillion, he was at least in the right order of magnitude.
Those long tail costs can be longer than one might think.

On a very different but related subject, another of the economists we'll listen to is Elroy Dimson, pictured here on the right:
Along with the two other guys in the picture, I referred, in my callow youth to this trio as the "Hot New Boy Band, Staunton, Marsh and Dimson". They put together the annual Credit Suisse Global Investment Returns Yearbook. The 2012 edition led off with a cogent discussion of various investments under inflation and deflation regimes.

Along with David Chamber, Prof. Dimson wrote the definitive exploration of Keynes as a money manger.
(although they don't give as much credit to material non-public information as I do)
He hangs his hat at the London Business School and at Cambridge's Judge Business School and advises the Norwegian sovereign wealth funds whenever they seem about to do something wild. He also researches and writes on nontraditional assets:
Prof. Dimson: "New research reveals that wine outperformed art, stamps and bonds throughout the 20th century"