In the previous post, capacity utilization is low and steady, and inflation is too. Low inflation is a sign that labor has a liquidity disadvantage to capital. Explanation below. Here is inflation (all items less food and energy on a quarterly basis). Link to graph #1. Quarterly inflation. Is this a problem? Well… One way […]
Matt Stoller @matthewstoller I like that ‘Larry Summers once vaguely tried to talk to Elizabeth Warren but didn’t’ has become ‘massive outreach’… http://www.washingtonpost.com/business/economy/in-race-for-fed-chair-larry-summers-reaches-out-to-elizabeth-warren/2013/09/13/40a776ea-1cb0-11e3-82ef-a059e54c49d0_story.html In race for Fed chair, Larry Summers reaches out to Elizabeth Warren Economist sought meeting with Sen. Elizabeth Warren; opposition from Democrats intensifies.
Here is the latest reading on capacity utilization. Data for August 2013 released yesterday. Link to graph. It has been flat-lining for over a year and a half. Look familiar? Similar thing was happening before the crisis. Note: To really appreciate capacity utilization, here is a table giving the sectors of industrial output involved and […]
Nobel Memorial Prize Winning Economist James Heckman has a piece in the Opinionator section of the NYT (is that a printed section, by the way, or online-only?) that reveals the lie behind the farce that is Arne Duncan’s “leadership”: Children raised in disadvantaged environments are not only much less likely to succeed in school or in […]
by Robert Waldmann Kevin Drum quotes Tyler Cowen and I wrote a huge comment (without clicking the link) just about the quoted passage. “Tyler Cowen posits today that on economic issues, the right wing was both more dynamic and more correct than the left during the 70s and 80s, with “peak right” coming in 1989. After that, […]
I wrote that Paul Krugman is assuming full-employment. Yesterday Krugman basically pleaded with the Fed to not taper. I see full-employment as constrained by effective demand, which can be determined by quite simple equations. My view comes from Keynes and chapter 3 of his General Theory book. “An alternative, though equivalent, criterion is that at […]
The principles of effective demand can be used to evaluate the aggregate profit rate on capital. This measure is a useful indicator of the business cycle. When the aggregate profit rate gets sluggish or falls, the economy is tempting a recession. The basic equation to determine the aggregate profit rate on capital is… Aggregate profit […]
Via Naked Capitalism comes this video discussion FIVE YEARS ON, LEARNING LEHMAN’S LESSONS FROM THE PANIC OF 2008- Panel Discussion in a panel discussion with James K. Galbraith (Economics Professor at the University of Texas), Neil Barofsky (former Inspector General for overseeing TARP), John Coffee (Law Professor at Columbia University). A link to the entire event, including Elizabeth […]
Details here.