The Angry Bear

The Wall St. Journal quoted Peter Thiel’s business plans. It is mostly behind a paywall. By Peter Thiel          Sept. 12, 2014 11:25 a.m. ET What valuable company is nobody building? This question is harder than it looks, because your company could create a lot of value without becoming very valuable itself. Creating value isn’t enough—you also need to capture some of the value you create. New Republic points us to the politics of Democrats...

The post entitled “Trump’s Claim Mueller Found ‘NO COLLUSION’ Is Literal Nonsense” is not up to Jon Chait’s usual standard. Trump’s claim is, of course, nonsense. Chait accurately described Trump’s typical pathetic rhetorical trick “One of President Trump’s favorite methods to defend his innocence in the Russia investigation is to claim that any piece of evidence that does not explicitly assert his guilt is in fact evidence of his innocence. ” and...

All Economists Are Bastards — Except Us Peter Frase has a very interesting post up about the role of popular culture in legitimizing the police.  Frase recounted a forum he attended with Alex Vitale  talking about his book, The End of Policing. In response to a question about why people believe that the function of policing is to maintain peace in the liberal order when its actual practice and history suggest otherwise, Vitale cited television cop shows...

Fiscal Stability or Dire Straights: John Cochrane’s Latest Rant At times John Cochrane babbles on incoherently on what should be a straight forward issue. This post is one example: Once you net out interest costs, it is interesting how sober US fiscal policy actually has been over the years. In economic good times, we run primary surpluses. The impression that the US is always running deficits is primarily because of interest costs. Even the notorious...

Why I’m worried about the decline in real wages This is a follow-up to my post yesterday concerning the decline in real average and aggregate wages. Why should the data from just one month cause me to warn that “This is Bad?” To show you, let’s decompose the data into CPI and nominal aggregate wages, shown in the below two graphs, the first of which covers the inflationary era of the 1960s and 1970s, and the second covers the disinflationary era since:...

This is bad: real wages *declined* in January; may be rolling over Consumer prices rose +0.5% in January. That in itself isn’t bad news, as they rose an equal +0.5% one year ago, so the YoY inflation rate remains at +2.1% (so if 2% really is a target rather than a ceiling, it should not give the Fed any cause for alarm). But that much vaunted wage hike in the January jobs report has entirely disappeared, and not just for non-managerial workers, but for...

Rumble on Wall St. — No Other Way of Keeping Profits Up! At Jacobin, Seth Ackerman did an interview with J.W. Mason about The Class Struggle on Wall Street that considers the trade-off between relative profit and wage shares of income. Whether you agree with his analysis or not, Josh teases out some of the implications of the relationship, both for profit expectations and for political prospects. One assertion I would question is “there is absolutely no...

Baumol Cost Disease and Relative Prices – Part 2 Many thanks to the Angrybear for reposting this as well as some excellent comments (save that absurd contention I’m a Luddite). If you check the comments over at Mark Perry’s place you will see that Paul Wynn made the same point I made and even linked to Timothy Lee: This became known as Baumol’s cost disease, and Baumol realized that it had implications far beyond the arts. It implies that in a world of...

The WaPo Gang Going After The Usual Suspects On the Budget Falls On Its Face Factually All right, all right, that is not completely fair.  Yes, they dump all over Trump and the GOP-run Congress for their massive tax cut directed at the rich, as well as the hypocrisy of the Republicans in so smoothly switching from denouncing budget deficits during the Obama era to a “what? me worry?” attitude now with deficits set to soar in a period of near full...