Labor’s share of national income sets a limit upon the utilization of labor and capital. That is the basic principle of effective demand. Domestic production periodically hits the effective demand limit. But are imports also constrained by the effective demand limit? Yes, they are, at least for the US. Let’s look at imports to exports. […]
House Speaker John Boehner told a closed meeting of his colleagues that a Republican pollster found that for the first time, most Americans blame President Barack Obama for the economic troubles, not George W. Bush. “Barack Obama came into office blaming George W. Bush for the state of the economy and the lack of job […]
Via an Economic Policy Newsflash (hat tip KH): On Tuesday, January 14, 2014 at 9:15 a.m. ET, Jason Furman (Chairman of the White House Council of Economic Advisers), Sen. Tom Harkin (D-Iowa), Rep. George Miller (D-Calif.) will join EPI President Lawrence Mishel to discuss the economic case for raising the federal minimum wage and their […]
I don’t think there’s anything eye-popping or revolutionary this post, but it’s thinking that I’ve been finding useful. Long before Larry Summers bruited his recent ideas about secular stagnation and the need for bubbles, I came up against this great line from Nick Rowe (April 2011): The economy wants a Ponzi scheme. I’ve been pondering […]
I’m rather devastated to find (thanks to Tom Brown at Pragmatic Capitalism!) a discussion I missed at Winterspeak’s place from mid-December, with some of my favorite commenters going after the underconsumption argument that I’ve been going on about. It starts by citing Mark Sadowski’s comment from Interfluidity “clarifying the difference between wealth and income.” I […]
by Robert Waldmann Poverty and the Laboratories of Democracy Kevin Drum reports on the latest effort by a Republican to pretend he gives a damn about the poor. Marco Rubio proposes, among other things, the bold new idea of block grants. Drum condemns the proposal, but writes that there have been some advantages from Fedralism. […]
This wave occurred 3 days ago and is an analogy for investing when stock prices are high. One guy barely escaped. The other guy thought he could make it. But he may end up winning the biggest wave of the year, and receive a bunch of money. Life is funny that way.
The United States does not have the traditional type of financial repression where savers are household consumers who primarily deposit their savings in banks. And where borrowers are producer firms that primarily borrow at banks. These constraints apply mostly to emerging economies. The key with these constraints is to tie consumption to the return on […]
I once decided not to do this, but I’m dumping a comment here. Brad DeLong thinks about Larry Summers and secular stagnation, Olivier Blanchard and higher inflation targets and Ryan Avent here. I can’t summarize his post but I comment here.
I want to remind readers that while our attention is on one part of retirement funding, there is a lot left out from the performances of defined benefit plans, IRA and Roth IRA, and 401ks. Kenneth Thomas does some reminding in past posts: Solutions to Middle Class retirements 66 trillion retirement saving shortfall The fiscal […]