Category: Economic TheoryThe analysis published under this category are as follows.
Tuesday, May 14, 2013
Anti-consumerism is steadily advancing and gaining political visibility in Europe, as a Lost Decade opens up for Europe's present 29 million unemployed persons. Europe's huge ranks of youth unemployed, sometimes over 50% of the 16-25 year age group in the worst affected countries, know they have No Future. In some countries like Greece, they have been simply and officially told by the government that their only chance is to get out of the country. In others like Spain, the depth of crisis has forced the state to seize some foreclosed properties, simply to prevent the country's ever growing number of homeless families becoming too socially explosive, but its youth has No Future.
Monday, May 06, 2013
Hunter Lewis writes: In the beginning of The General Theory, John Maynard Keynes says that his ideas will no doubt be rejected because they are so novel and revolutionary. Toward the end of the same book, he seems to have forgotten this because now he says he is reviving the same centuries-old ideas that he had once dismissed as the most absurd fallacies. At least he acknowledges that he is changing his position, although he does not explain how his ideas can be new, revolutionary, and also centuries old.Read full article... Read full article...
Tuesday, April 30, 2013
Keith Fitz-Gerald writes: When it comes to spending or saving, it's always a contentious debate.
But the risks are rarely as high as they are now for the U.S. and most major industrial nations. Such fundamental economic decisions will move a country forward (or backward) for decades, not months, and can't be undone quickly.
So let's choose the "winner" and "loser" of this debate carefully.Read full article... Read full article...
Thursday, April 25, 2013
American singer Loudon Wainwright III has a song with this line: "I read the New York Times, it's where I get the news. Paul Krugman's on the op-ed page, that's where I get the blues".
Every era needs its gurus and sages, we are told. Keynes was in fact only an elite-approved guru right at the end of his life, but managed to do a lot of damage before quitting this world, leaving us the IMF as well as the already long-dead Bretton Woods agreement.Read full article... Read full article...
Tuesday, April 23, 2013
"The world’s leading economies acknowledged on Friday that 'further actions are required' to put the global economy on track for strong, stable and balanced growth.", writes the FT. The torture never stops. Not that we had expected it to just today.
Well, alright then, you can make a point that the biggest news in economics last week was the revelation of the errors in Rogoff and Reinhart's "debt over 90% is deadly" paper. Personally, I think what is still much bigger is the - renewed - revelation that actual policies executed by actual politicians have been based on that paper. Talk about poverty of ideas and imagination. But maybe that shouldn't be surprising. If anything's the core of economics it's such poverty. And that politicians in turn base their policies on that poverty is only fitting. As an old Buddhist adage says: If and when everyone is mindlessly stupid, will anyone notice?Read full article... Read full article...
Saturday, April 13, 2013
Riots in the streets; protest against a hated government; cops arresting protesters. A familiar story these days. But suddenly we find that the protests are directed, not against a hated Communist tyranny in Eastern Europe, but against Mrs. Thatcher's regime in Britain, a supposed paragon of liberty and the free market. What's going on here? Are anti-government demonstrators heroic freedom-fighters in Eastern Europe, but only crazed anarchists and alienated punks in the West?Read full article... Read full article...
Friday, April 12, 2013
As the top Keynesian gadfly, Paul Krugman's recent attack on Margaret Thatcher wasn't very surprising.
In a blog post on the very day she passed, he questioned whether or not Margaret Thatcher had actually made any difference to the performance of the British economy.Read full article... Read full article...
Friday, April 12, 2013
Picture a mono-racial New York metropolitan area with a fraction of the murders, if you can. Add in unreadable signs and buildings and infrastructure completed in 1960 or later. Then you might have a picture of Seoul, the capital of the Republic of Korea and, quite possibly, the new center of global capitalism. At least, that is my conclusion after spending several days there on academic and professional pursuits.Read full article... Read full article...
Friday, April 12, 2013
David Stockman writes: Even the tepid post-2008 recovery has not been what it was cracked up to be, especially with respect to the Wall Street presumption that the American consumer would once again function as the engine of GDP growth. It goes without saying, in fact, that the precarious plight of the Main Street consumer has been obfuscated by the manner in which the state’s unprecedented fiscal and monetary medications have distorted the incoming data and economic narrative.Read full article... Read full article...
Friday, April 12, 2013
I have experienced not one but two cases where eminent mainstream economists characterized Austrian economics as a cult. I told a friend and colleague of mine who is also an Austrian economist that I would be writing about this. He was worried that to mention the fact that two leading economists held the opinion that Austrian economics is cultish would place the praxeological school in a bad light. Well, maybe it will. However, I strongly believe that "sunlight is the best disinfectant." If these two dismal scientists strongly believe this, they can hardly be the only ones. My goal in writing this present essay is to attack this view as the pernicious and false doctrine that it is. I want to confront it, not run and hide from it.Read full article... Read full article...
Monday, April 08, 2013
In a review of main points from David Stockman's troublesome new book for peddlers of the mantra "We are all Keynesians now", in an economic world that Keynes wouldn't even be able to recognize, William Anderson listed the ways that "Neo Keynesians" not only hobble the fragile booms their basically schizophrenic policies produce, but also the fake recoveries that follow in their wake. In particular Anderson looks at Stockman's argument that when an economic boom crashes, the proper response of governments and monetary authorities should be to restore sound money and not try to prop up enterprises that failed in the crash. http://www.marketoracle.co.uk/Article39835.html
Friday, April 05, 2013
This week, while economists should have been closely considering the implications of the actual bankruptcy of Stockton, California, they instead heaped scorn on the perceived ideological bankruptcy of David Stockman. In other words, Stockman trumped Stockton.Read full article... Read full article...
Thursday, March 21, 2013
Grant Williams writes: On March 14, 1879, in Ulm, a tiny town on the banks of the river Danube in the German state of Baden-Württemberg, a boy was born to a Jewish electrical engineer and his wife.
Hermann and Pauline Einstein had no idea that their first-born son would one day change the way humans look at the world around them.Read full article... Read full article...
Saturday, March 16, 2013
Libertarians commendably focus on maximizing Economic Freedom and Individual Liberty. Who, after all, wants not to be economically and politically free?
But there is considerable dispute even among libertarians about what freedom does, or should entail regarding a variety of crucial issues such as “free trade,” immigration, and the proper role of government.
A profitable (and proper) understanding of Freedom is essential to maximizing Individual and Political Freedom, and to Protecting Economic Freedom and thus enhancing Wealth and Prosperity.Read full article... Read full article...
Saturday, March 09, 2013
HORSEMEN OF THE APOCALYPSE
In a recent post Brian Bloom gave a list of reasons why he thinks politicians, worldwide, are spitting in the wind by turning their prayer wheel of "reform and recovery" to "relaunch the economy", which for major sectors like carmaking in Europe are facing an endgame scenario. In the recent high profile spat between the CEO of Titan International, who totally rejected any idea of taking over Goodyear's unprofitable tyre factory in Amiens, and France's minister of Industrial Recovery, Arnaud Montebourg, Titan's CEO said he could buy a tyre factory in either China or India where at most he would need to pay the workers 1 euro per hour: say $250 per month. Nobody in Europe can even eat and buy clothes and shoes to put on their backs and feet, let alone buy a house, electricity and water, a car, cellphone, Internet access and all the rest, for that pay. Starvation wages to "relaunch the economy" !