According to some accounts, the conflict in Eastern Ukraine is a tug of war over the region’s mines, steel mills and other heavy industry. The website European Dialog, for example, tells us the region is “crucial to Russia,” which “values Ukraine because of industries, like steel and agriculture, that have served as vital inputs for … Read more
SKILL MISMATCHES BETWEEN AMERICAN WORKERS AND AMERICAN EMPLOYERS The slow recovery in the United States from the Great Recession has been characterized by an unusually high unemployment rate. Observers have disagreed about the relative importance of skill mismatch and insufficient aggregate demand as causes of high unemployment. The two explanations are not mutually exclusive, … Read more
The blog-O-sphere has been lit up in recent days with Krugman’s announcement that he’s frustrated by the gloating of Heterodox Economists. He claims that with good hindsight, all the mainstream economists who “never saw the crisis coming” can use their flawed textbook approach to explain what happened. Gee, that makes me feel a lot better! … Read more
Review of David Zetland, Living with Water Scarcity, Aguanomics Press, 2014 Whether it’s cowboys facing off over a muddy water hole in an old Western, or the dirty looks you get if you fill your supermarket basket with bottled water, no one ever denied that people feel strongly about water. David Zetland’s new book, Living … Read more
According to the bank of Spain, the Spanish economy continued to push forward with its recent expansion in the first quarter, and it do so at an accelerated rate, growing by 0.4% over the previous three months. This is certainly good news for everyone in Spain, and there is no doubt that this is the … Read more
In order to reanchor expectations, the elected president will have to prioritize inflation’s return to its target. In its latest poll among economic analysts, the Brazilian Central Bank (BCB) computed the median of inflation expectations for 2014 above 6.5%, the ceiling of the band around the inflation target (4.5%). This has heated the debate about … Read more
Often, the problem with many policy actions employed to influence the economy is their unintended consequences. In the case of economic sanctions, it is not always easy to tell whether half a success is any better than a failure. On March 21, 2014, under the new sanctions regime, both Visa and MasterCard froze the card … Read more
I’ve seen some pretty bizzarre claims about MMTers. They are “tea partiers”, “barely left of center”, who “are not interested in policy”, who “ignore inequality”, who “are only interested in reducing taxes”. “MMTers ignore the fraud of the banksters.” They are at best “one issue” advocates for a particular view on money, taxes, and employment. … Read more
Yet another money manager “bites the dust”, falling for the MMT view that “taxes drive money”. See his piece, “The good you do for the dollar when you pay your taxes”, by Jon Shayne April 3, 2014; http://www.pbs.org/newshour/making-sense/the-good-you-do-for-the-dollar-when-you-pay-your-taxes/ I wonder why this is relatively easy for those who work in financial markets, but almost impossible … Read more
Last week’s announcement that China’s GDP grew at an annualized rate of 7.4% in the first quarter of this year has stirred speculation about that country’s economy. Some are skeptical of the data, and point to other indicators that suggest slower growth. Although a deceleration in growth is consistent with the plans of Chinese officials, policymakers may respond with … Read more