and Investing
If so, it isn’t because of this So the Wall Street Journal published an article about how Donald Trump is losing the trade war with China. A serious matter, if true. Yet whether it’s true or not, this article doesn’t make the case, even though written by Jason Furman, chairman of the White House Council … Continue reading “WSJ: Trump is losing the trade war with China”
The cornerstone of John Maynard Keynes’ General Theory of Employment, Interest and Money is the rejection of one of the pillars of classical economics, and indeed of virtue itself classically understood. That pillar is saving. In that classical world, saving is a fundamentally important action, crucial to economic survival and growth. From it flows the … Continue reading “The Paradox of Unthrift Waiting for another – doubtless very different – Keynes“
The current fracas with regard to immigration through the southern border of the United States will die down in time, and another issue will replace it in the headlines, in breaking news announcements, in round-table discussions. There will not be a resolution any time soon. But what is important is to understand the underlying issues … Continue reading “Immigration, Migration, and Imbalances”
The trickle of articles discussing the proposed Border Adjustment Tax (BAT) has turned into a veritable flood. Not surprisingly, the lion’s share of these articles oppose the idea of border adjustment. It would be tedious to run through them all; suffice it to say that the primary argument is that such a tax would raise … Continue reading “Border-Adjustment Sleight of Hand? Sense and Nonsense on the Border Adjustment Tax“
The fledgling Trump administration has been greeted by an explosion of resistance on the part of the Left. The Democratic Party has shown its antipathy in various ways. For one thing, many Democratic members of Congress declined to attend the inauguration. For another, Senate Democrats have delayed the appointments of President Trump’s cabinet appointees, even … Continue reading “The Shape of Things to Come?”
Donald Trump’s election victory on November 8th is now a fact. Reactions to it have not been lacking, of course. On the economic front, they have ranged from the cautiously optimistic to predictions of utter doom. For their part, the financial markets went from downturn to upturn in short order (as chronicled here by Jerry … Continue reading “Trumponomics and the Great Rebalancing”
The 2013 movie Elysium depicts a dystopian future of unremitting, jarring poverty juxtaposed with serene, detached wealth. Literally detached: wealth resides in a lavishly equipped, lebensraum-furnished space station, high above an impoverished, exhausted Earth. The planet is only useful as a source of provision and maintenance for the space station; its fruits have been extracted … Continue reading “On the Road to Elysium When fiction approaches fact“
We can conduct a similar analysis of the European economy as we did for the US economy. We will restrict our discussion to the Euro Area, the countries which share a common currency, the euro. The euro creates a unique, separate trading bloc, the internal dynamics of which need to be understood both to assess the … Continue reading “Prospects for the European Economy”
THE WORLD ECONOMY IN RÉSUMÉ In the previous post we outlined the structural condition of the world economy, and in particular the structural flaws it contains. The main flaw is the divorce between production and consumption. Prior to the establishment of this new macroeconomic structure, supply and demand were roughly in balance in the domestic … Continue reading “Prospects for the US Economy”
Much has been written on the recent decision by the UK to leave the European Union. Much of it is emotion-driven. But that is no way to assess such an important turn of events. The actual significance is, in significant degree, economic in nature. This calls for an economic analysis, to which we now turn. … Continue reading “The Economic Consequences of the Release (i.e., Brexit)”
Given the rancorous debate unleashed by the UK electorate’s decision to depart the European Union – in particular, regarding the damage to the UK economy that independence might bring – it seems wise to re-examine the foundations of economic prosperity and its relationship to political and legal factors. I do so by examining Hernando de … Continue reading “The Mystery of Capital in Context”
When Schumpeter writes, “Now to the question: what is a savings account?”,[1] he is not being facetious. There is more to savings than meets the eye. Of course, the bare fact of saving is simple enough to understand. Rather than spend all of our earnings, we take some and put it to one side. What … Continue reading “The Problem of Saving”
Ever since I can remember I have been a proponent of free trade. It seemed the logical thing: why should the government restrict economic activity which in itself is legal and aboveboard? And when I began exploring economic theory, lo and behold, free trade was at the forefront of most every exposition. It was the … Continue reading “Confessions of a Free Trade Advocate”
At first glance the notion of a national economy would seem to be self-evident. After all, the lion’s share of economic data comes in the form of “national accounts,” which treat the nation as a self-contained economic entity, like a business. And the talk, when it comes to the economy, is always of how the … Continue reading “National Economy?”
Seeing as how the gold standard is a “money method”[1] by which all exchange value is made dependent upon the weight of a certain substance, viz., gold, it would seem appropriate to “weigh it up” to determine whether or not, “weighed in the balance,” it is “found wanting.” Indeed, weight measurement was the standard of … Continue reading “Weighing the Gold Standard”