Analysis Topic: Economic Trends Analysis
The analysis published under this topic are as follows.
Thursday, April 10, 2014
For More Jobs and Stability, Set the Economy Free / Economics / Economic Theory
By: MISES
John P. Cochran writes: The headline in the print edition of theDenver Postof an associated press story on the nominationof Janet Yellen highlights a quote from President Obama, “She understands the human cost when people can’t find a job.” This statement about then-new Fed Chair Yellen, which emphasizes Yellen’s Keynesian-based commitment to the unemployment prong of the Fed’s dual mandate, underlies why some economists feared that no matter how bad policy might have been during Bernanke’s tenure, policy is likely to get worse rather than get better from a sound money perspective during a Yellen reign. Her empathy for the unemployed was clearly present in her remarks following her first official policy meeting which as reported by the Wall Street Journal “were a notable affirmation of her commitment to low rates until the economy is much stronger.” She emphasized, “The recovery still feels like a recession to many Americans, and it also looks that way in some economic statistics.” She then chose to support her remarks not with usual econ jargon and statistics, but“Ms. Yellen instead exhibited a personal touch ... by coloring her comments with experiences of three people who had struggled to gain full-time work.”
Thursday, April 10, 2014
Economic Sanctions Not Key Cause of Russia’s Next Recession / Economics / Russia
By: Frank_Shostak
According to commentators, sanctions imposed by the US and the European Union are pushing Russia toward a recession. However, we hold that some key Russian economic data have been displaying a weakening prior to the annexation of the Crimea to Russia. This raises the likelihood that sanctions might not be the key factor for an emerging recession.
Thursday, April 10, 2014
Entrepreneurship: The Driving Force of the Economy / Economics / Economic Theory
By: Peter_G_Klein
Author of The Capitalist and the Entrepreneur, Peter Klein has published numerous books and articles on entrepreneurship from an Austrian perspective. Dr. Klein, who is executive director and Carl Menger Research fellow at the Mises Institute, was interviewed in late 2013 by eTalk’s Niaz Uddin on the topic of entrepreneurship:
Niaz Uddin: Tell us about entrepreneurship. What are the different contexts of entrepreneurship?
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Thursday, April 10, 2014
Europeans Ordered to Start Consuming / Economics / Euro-Zone
By: John_Rubino
For the past couple of years the European Central Bank has been the only sane inmate in the asylum. Unfortunately, in a crazy world being sane just gets you into trouble. Sound monetary policy leads to a strong currency, which in a currency war is tantamount to unilateral disarmament. Unable to export sufficiently to a world of weak currencies, the eurozone is tipping into deflationary depression (with several members already there and unable to get out). So…
Tuesday, April 08, 2014
Euro-zone Bazooka - Whatever It Takes 2.0? / Economics / Euro-Zone
By: Axel_Merk
If you are convincingly irrational the market may expect extreme measures and front run your bluff. It’s in this spirit that ECB President Draghi is threatening the market with another bazooka. We discuss implications for investors.
Monday, April 07, 2014
Why Keynesian Economists Don’t Understand Inflation / Economics / Inflation
By: Frank_Hollenbeck
The “monetary cranks” and “ignorant zealots” of old are back preaching salvation if only we had more inflation.[1] Keneth Roggoff and Fed President Charles Evans did not mince words, while others have been more circumspect. Christine Lagarde warns us of the “ogre of deflation” and the “risks” of low inflation, while others have been urging easier monetary policy to reduce the value of the yen or the euro. Of course, it’s much easier to let this inflation tiger out of its cage than to get it back in.
Sunday, April 06, 2014
We Don’t Need “Animal Spirits” to Understand Economics / Economics / Economic Theory
By: MISES
Per L. Bylund writes: A recently published article at The Week, titled “How can we unleash positive animal spirits into the economy? Change the narrative,” provides a clear example of what’s wrong with the perception of economics and why modern economic approaches, possibly aiming to amend the shortcomings“identified” by this perception, is at a loss of explaining anything important.
Sunday, April 06, 2014
Abenomics Stagflation - It's in Shinzo Abe's (Political) Genes / Economics / Stagflation
By: Richard_Mills
Japanese Prime Minister Shinzo Abe's "Abenomics" goal was to end a long miserable decade and a half of deflation by kick starting the economy. This was going to happen because of massive yen creation. The fiat balloon would induce consumers to spend and corporations to reinvest profits, convinced by a rising stock market and surging exports that all is well.
The Bank of Japan pumped liquidity into the economy at a pace even faster than the U.S. Federal Reserve - $60 billion a month versus $85 billion (the U.S. economy is three times larger than Japan's).
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Sunday, April 06, 2014
Inflation Hysteria And The Revenge Of Central Banksters / Economics / Inflation
By: Andrew_McKillop
Christine Lagarde Wants “Low-Flation”
Lagarde has been rightly ridiculed and accused of “jabberwockery”, for example by David Stockman who also says that what she calls plain good sense, is “pure Keynesian claptrap”. She opines that one of her sincerest and enduring concerns for the global economy moving forward, is that “low-flation” especially in the Eurozone countries will or might suppress growth and jobs. So of course she is rooting for more Fed-style and ECB-style and BOJ-style, and BOE-style monetary easing. Print and forget!
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Friday, April 04, 2014
Meet "Lowflation": Deflation's Scary Pal / Economics / Inflation
By: Peter_Schiff
In recent years a good part of the monetary debate has become a simple war of words, with much of the conflict focused on the definition for the word "inflation." Whereas economists up until the 1960's or 1970's mostly defined inflation as an expansion of the money supply, the vast majority now see it as simply rising prices. Since then the "experts" have gone further and devised variations on the word "inflation" (such as "deflation," "disinflation," and "stagflation"). And while past central banking policy usually focused on "inflation fighting," now bankers talk about "inflation ceilings" and more recently "inflation targets". The latest front in this campaign came this week when Bloomberg News unveiled a brand new word: "lowflation" which it defines as a situation where prices are rising, but not fast enough to offer the economic benefits that are apparently delivered by higher inflation. Although the article was printed on April Fool's Day, sadly I do not believe it was meant as a joke.
Thursday, April 03, 2014
Deflating the Deflation Myth / Economics / Deflation
By: MISES
Chris Casey writes: The fear of deflation serves as the theoretical justification of every inflationary action taken by the Federal Reserve and central banks around the world. It is why the Federal Reserve targets a price inflation rate of 2 percent, and not 0 percent. It is in large part why the Federal Reserve has more than quadrupled the money supply since August 2008. And it is, remarkably, a great myth, for there is nothing inherently dangerous or damaging about deflation.
Wednesday, April 02, 2014
Three Ways to Combat Economic Recovery That Even the Fed Says Feels Like a Recession / Economics / Economic Recovery
By: DailyGainsLetter
John Paul Whitefoot writes: Federal Reserve Chair Janet Yellen confirmed what we’ve been espousing in these pages for the last couple of years—that the so-called recovery feels an awful lot like a recession for most Americans.
Addressing a crowd in Chicago, the head of the Federal Reserve said the U.S. jobs market is still underperforming and will continue to need the help of an artificially low interest rate environment “for some time.”
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Wednesday, April 02, 2014
Debt Makes You Dumb, Japanese Edition / Economics / Global Debt Crisis 2014
By: John_Rubino
Debt works the same way for countries as for families and individuals. That is, if you borrow too much, your life begins to suck. And actions that in normal times might have seemed unwise, contradictory or downright stupid begin to look better than the (even more disturbing) alternatives.
Monday, March 31, 2014
Inflation Is Coming, What to Do NOW! / Economics / Inflation
By: Jeff_Clark
We’ve all heard of the inflationary horrors so many countries have lived through in the past. Third-world countries, developing nations, and advanced economies alike—no country in history has escaped the debilitating fallout of unrepentant currency abuse. And we expect the same fallout to impact the US, the EU, Japan, China—all of today’s countries that have turned to the printing press as a solution to their economic woes.
Now, it seems obvious to us that the way to protect one’s self against high inflation is to hold one’s wealth in gold… But did citizens in countries that have experienced high or hyperinflation turn to gold in response? Gold enthusiasts may assume so, but what does the data actually show?
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Sunday, March 30, 2014
China’s Ponzi Scheme Unravels / Economics / China Economy
By: LewRockwell
China is the greatest construction boom and credit bubble in recorded history. An entire nation of 1.3 billion has gone mad building, borrowing, speculating, scheming, cheating, lying and stealing. The source of this demented outbreak is not a flaw in Chinese culture or character—nor even the kind of raw greed and gluttony that afflicts all peoples in the late stages of a financial bubble.
Wednesday, March 26, 2014
We Do Not Live in a Post-Scarcity World / Economics / Economic Theory
By: William_Anderson
Jeremy Rifkin long has perfected the art of adding two and two and getting five. In the 1980s, he claimed that entropy made it impossible for a free economy to exist, and therefore Rifkin concluded the state needed to plan and run things. How the state would triumph over the second law of thermodynamics is anyone’s guess. He later declared that a new “hydrogen economy” was just around the corner — government just needed to engage in central planning and order hydrogen to be our new fuel of choice.
Wednesday, March 26, 2014
Minsky’s Financial Instability Hypothesis / Economics / Economic Theory
By: John_Mauldin
Looking back, I see that I have mentioned the name Hyman Minsky in no fewer than ten Thoughts from the Frontline letters in just the past two years; and his name has popped up in all four letters so far this month, most notably on March 1, when we brought back one of my most popular pieces, “Black Swans and Endogenous Uncertainty” (the “sandpile” letter) and last week, when the letter was titled “China’s Minksy Moment?”
I wasn’t consciously aware of how often I had trotted Minsky out as I sat (somewhat unstably, I have to admit) atop a headstrong horse in the foothills of the Argentine Andes the other day; but my precarious situation did somehow get me thinking of Minsky’s Financial Instability Hypothesis, and it occurred to me that both you and I might learn something by going right back to its source, which turns out to be a rather unprepossessing five-page paper Dr. Minsky published at Bard College in 1992.
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Wednesday, March 26, 2014
Will Inflation Make A Comeback In 2014 When Consensus Worries About Deflation / Economics / Inflation
By: GoldSilverWorlds
Two months ago, Incrementum Liechtenstein released its chartbook entitled “Monetary Tectonics” which illustrated the raging war between inflation and deflation in 40 charts. Meantime, the authors of the chartbook have launched the “Austrian Economics Golden Opportunities Fund,” a fund that takes investment positions based on the level of inflation. The key tool in their investment decisions is the “Incrementum Inflation Signal” (also referred to as the “monetary seismograph”), a continuing measurement of how much monetary inflation reaches the real economy based on a series of market-based indicators.
Tuesday, March 25, 2014
The Huge Economic Indicator Everyone Misses / Economics / US Economy
By: Money_Morning
Keith Fitz-Gerald writes: If you like bull markets, you better hope Janet Yellen is one of the most talkative Fed Chairs in history.
It's not that she's going to say anything brilliant or insightful, just that she says something - anything - on a regular basis.
You see, there's a direct relationship between how much she says and what's happening in the markets. What she says is almost completely irrelevant.
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Tuesday, March 25, 2014
Let the Economic Data Speak: The Truth Behind Minimum Wage Laws / Economics / Wages
By: Steve_H_Hanke
President Obama set the chattering classes abuzz after his recent unilateral announcement to raise the minimum wage for newly hired Federal contract workers. During his State of the Union address in January, he sang the praises for his decision, saying that “It’s good for the economy; it’s good for America.” As the worldwide economic slump drags on, the political drumbeat to either introduce minimum wage laws (read: Germany) or increase the minimums in countries where these laws exist – such as Indonesia – is becoming deafening. Yet the glowing claims about minimum wage laws don’t pass the economic smell test. Just look at the data from Europe (see the accompanying chart).Read full article... Read full article...