Relevant and even prescient commentary on news, politics and the economy.

Let’s remember the economics

As over 85% of Trump supporters say they are standing by him, let’s remember the economy.

Labor share has to rise. Corporate profits have to decline. Corporate taxes have to rise. The general population needs to have more of a share of the liquidity sloshing around the world.

Trump is in favor of a low minimum wage, lower taxes and less regulation to protect society against negative externalities. So Trump will not fix the economy. He will make it worse.

Hillary will raise taxes on corporations and higher incomes. She will fight to have overseas profits brought home. She will fight for a higher minimum wage. The prospects are better with Hillary for a better economic future.

Romney denounces Trump without denouncing his own religion

But Joseph Smith, founder of Mormonism, did the same. Romney is Mormon and follows Joseph Smith. Unfortunately there was no social media in his time.


Edward Harrison on Biz Cycle coming to its end

In the video below, Edward Harrison of Boom/Bust says some important things. Watch after 25:30 minute point.

  • the unemployment rate is not a leading indicator for a recession. Unemployment can start to tick up as a recession is starting.
  • watch non-farm payrolls.
  • the Biz cycle is coming to its end.

So many well known economists got the business cycle wrong. They stated all along that the Fed should keep rates low until the recovery got going. They still see a large part of the cycle ahead. They see slack but they did not see an effective limit on the slack.

The Fed missed a whole interest cycle. It is important to follow an interest cycle with proper rates that discipline production. If rates stay too low for too long, as we have seen, then zombies more and more infect productivity, prices and production.

But I totally agree with him. My models have been tracking the business cycle correctly for years. The ultimate end of the business is drawing upon us… I give it by middle of next year for sure, and as I have been saying all year, a 70% chance by the end of 2016.