Quotes from Charles Wheelan

The one social factor that researchers agree is consistently linked to longer lives in every country where it has been studied is education. It is more important than race; it obliterates any effects of income."4

One currency can be swapped for another at whatever rate two parties are willing to make a voluntary trade.

In general, economists tend to favor taxes that are broad, simple, and fair. A simple tax is easily understood and collected;

What was different about this crisis was that the institutional structure was different. It was not banks and depositors; it was broker-dealers and repo markets, money market funds and commercial paper. But the basic idea of providing short-term liquidity in order to stem a panic was very much what Bagehot envisioned when he wrote Lombard Street in 1873." 37

But it's not perfect. The GPA does not reflect the difficulty of the courses that different students may have taken.

Something really wacky happens when rice bankers start loaning out other people's capital: money is created.

The overall lesson of this chapter is that statistical malfeasance has very little to do with bad math.

The harvest is good. Families are awash with rice. Deposits at the rice storehouses climb, enabling more loans. Land values are rising, both because credit is more readily available and because villagers believe future harvests will continue to be bountiful.

An economist is someone who is good with numbers but does not have the personality to be an accountant." The tarnished image of

New York Times has noted, "Data is merely the raw material of knowledge.

Second, even if the underlying data could accurately predict future risk, the 99 percent assurance offered by the VaR model was dangerously useless, because it's the 1 percent that is going to really mess you up.

In fact, the models had nothing to say about how bad that 1 percent scenario might turn out to be.

Statistical analysis is the detective work that crafts the raw data into some meaningful conclusion.

In some ways, the VaR debacle is the opposite of the Schlitz example in Chapter 5. Schlitz was operating with a known probability distribution

Let's start with three crucial wrinkles in the aforementioned logic.

Maybe it's a stretch to blame a broader social pathology on hyper-competitive soccer parents. Still, there is not a huge downside to asking every once in a while, Why am I doing this? We will know for certain that my analysis is wrong when we see the following obituary: Bob Smith died yesterday at the age of 74. He finished life in 186th place.

Bert confused a burst of new spending caused by growth in the money supply with an increase in demand for his products.

It's easy to lie with statistics, but it's hard to tell the truth without them.

A market economy is to economics what democracy is to government: a decent, if flawed, choice among many bad alternatives.

The greatest risks are never the ones you can see and measure, but the ones you can't see and therefore can never measure. The ones that seem so far outside the boundary of normal probability that you can't imagine they could happen in your lifetime—even though, of course, they do happen, more often than you care to realize.

Economics is like gravity: Ignore it and you will be in for some rude surprises.

The real cost of something is what you must give up in order to get it, which is almost always more than just cash.

In a basic agricultural society, it's easy enough to swap five chickens for a new dress or to pay a schoolteacher with a goat and three sacks of rice. Barter works less well in a more advanced economy. The logistical challenges of using chickens to buy books on Amazon.com would be formidable.

At a time when we can split the atom, land on the moon, and decode the human genome, why do 2 billion people live on less than $2 a day?