The economy is nearing the natural level of real GDP and economists are saying that the natural rate of interest is negative. Now the natural rate of interest is the equilibrium interest rate when real GDP reaches its natural level. It is absolutely crazy to think that the natural rate would be negative… absolutely crazy. […]
Okay, once again I’m going to sacrifice my body here, risk looking stupid by asking what seems to me to be a vexatious question. Here’s the setup: When you exchange some of your money (bank deposits) for some shares of Apple stock, those shares aren’t removed from the supply of Apple shares. (Likewise your “money”; […]
I have written before about the gross waste of taxpayer monies on retail in the St. Louis region. According to the East-West Gateway Council of Governments (p. 18), governments in the bi-state metropolitan area pumped about $2 billion worth of subsidies into retail projects from 1990 to 2007, but only saw a net increase of […]
Lifted from Robert’s Stochastic Thoughts New Keynesian Good Two Keynesian Better Oddly, Paul Krugman seems to have perceived my observation that he is a two Keynesian rather than a new Keynesian as a criticism. In fact I much prefer simplest new Keynesian models to standard obscure new Keynesian models. Oh hell, my damn comment was waaay too […]
I saw this graph tweeted on twitter by Jesse Livermore, but I do not see who actually made the graph and how. It is a graph showing Kalecki’s profit equation. The thing that struck me is how similar it is to my own graph of aggregate profit rates based on an analysis of the NIPA […]
Via Alternet Jim Hightower offers a simplified look at the possible consequences of this trade deal: Twenty years later, the gang that gave us NAFTA is back with the TPP, a “trade deal” that mostly does not deal with trade. Of the 29 chapters in this document, only five cover traditional trade matters! The other […]
How much spare capacity remains in the economy in terms of labor and capital? This question is an incredibly important one… and economists such as Krugman, Bernstein and Baker are deluded by past grandeur… You will hear Paul Krugman say that the Fed rate must stay at the zero lower bound in spite of the […]
Secular stagnation involves the idea that Central bank interest rates will be at the zero lower bound (ZLB) for a long… long… time. And they will be because of falling labor share around the world. Yet, other economists are not even including labor share as a factor. Paul Krugman and Simon Wren-Lewis for examples. Labor […]
I have written lately about the how the cultural economics of China will fail to raise wages of labor and thus fail to re-balance their domestic demand. A video interview with Minqi Li by The Real News Network notes that recent decisions by the Chinese government are meant to raise income for the owners of […]
Via the Guardian, Orthodox economists failed market test After all, the large majority of economists who predicted the crisis rejected the dominant neoclassical thinking: from Dean Baker and Steve Keen to Ann Pettifor, Paul Krugman and David Harvey. Whether Keynesians, post-Keynesians or Marxists, none accepted the neoliberal ideology that had held sway for 30 years; and all understood that, […]