I wrote a post about the velocity of M2 money supply. There were comments that the M2 money supply is a dying indicator. Well, let’s look… There are 3 indicators for the money supply, M1, M2 and MZM. M1 is the narrowest. MZM is the broadest. M2 is in the middle. “M1 is the money […]
Using my model of core inflation, nominal rates, profit rates, labor share & capacity utilization, here is a graph of the present situation. The estimated natural real rate for this graph is 1.7%. The vertical dashed green line shows where capacity utilization is now at 75.2%. The solid red line shows the path of the […]
Outside the factory setting [which Clinton toured today before she gave her economic-policy speech], a scattering of pro-Trump protesters held “Hillary for Prison” signs and criticized Mrs. Clinton’s connections to Wall Street. And more than 1,000 miles away in Florida, Mr. Trump echoed that critique. “She doesn’t have the talent” to jumpstart the economy, Mr. […]
by Joseph Joyce Capital Flows and Financial Activity in Commodity Exporters Emerging markets and developing economies have struggled in recent years to regain the growth rates of the last decade before the global financial crisis. The slowdown has been particularly evident in commodity-exporters that face declining prices. The World Bank’s most recent Global Economic Prospects, […]
Straight from the Mercatus Institute, libertarian Tyler Cowen notes that fund managers who donate to Democrats outperformed fund managers who donated to Republicans. The difference is small compared to the huge volatility of stock market returns, but it is not small compared to the variance of the performance of the two groups of fund managers. […]
I have been presenting a new model to explain the forces around inflation. (link1, link2) Antonio Fatas poses a very good question. You can lower interest rates, but can you raise inflation? “But if monetary policy is being successful we expect inflation expectations and growth expectations to increase. Both of these forces should push long-term […]
In case you missed it, like I did, the velocity of the M2 money supply is declining more quickly. That normally indicates that the economy has taken the turn toward an eventual contraction.
by Mike Kimel Policy Demands for Black Power, Freedom and Justice Earlier this month NBC news reported: The Movement for Black Lives — under the catch-all banner of the Black Lives Matter movement — has put together what it describes as a “clear vision of the world where black humanity and dignity is the reality.” […]
I continue to explore the model that I posted this morning extending a relationship between inflation and capacity utilization. The model shows that labor share would determine the most balanced inflation target… and the inflation target then becomes variable depending upon the how labor share changes in the economy. Remember, it was once thought that […]