Mike Norman Economics

Smoot-Hawley redux?  Tariffs and trade wars have knock-on effects. It's impossible to tell that this point where this is all leading, but one thing is sure, the status quo ante is dead. What will emerge is uncertain. The presumption in the US that things will get better. This is yet to be determined and it isn't possible to  know from the data. In addition, the policy is in constant flux.  As a result, expectations are becoming more and more subject to "animal spirits," and less and...

Must-read. It's short.Not only does this have a potentially huge impact on Big Pharma, but it is also China poking the US in the eye in retaliation for it regards as humiliation. So it is also "saving face."Perhaps the largest and longest lasting impact of the trade war that is already occurring is the change in attitude of Chinese consumers about American products. The Chinese are very nationalistic and patriotic. They are also ethnically proud and justifiably so based on being able to...

The same day I wrote that capitalism was coming apart at the seams, indicated by the shocking disparity between the compensation of corporate CEOs and workers, the Business Roundtable published its new statement of purpose of a corporation.* The 180 or so corporate executives who signed the statement declared that all their stakeholders, not just owners of equity shares, were important to their mission. Many business pundits, such as Andrew Ross Sorkin, greeted the new statement as a sign...

The rest of the media is catching on to the fact that there is a paradigm shift underway in economics. This won’t be a surprise to you if you are a regular reader of Independent Australia. I’ve writtenabout two dozen articles on the main challenger to the old paradigm, which is modern monetary theory (MMT). Others have also written on this topic for IA. If you’ve been relying for news and current affairs on the usual suspects, however, the current controversy might have crept up on you....

This is Part 2 (and final part) of my series on printing money, debt and power. The two-part series is designed to draw a line through all the misconceptions and errors that abound on the Internet about the Modern Monetary Theory (MMT) treats deficit spending and bond issuance. The social media debate about MMT is at time nonsensical, thriving on falsehoods and fantasy. I get many E-mails after some robust Twitter exchange between some self-proclaimed expert who has found the latest fatal...

Fear and impatience.

I don't know what to make of this. Is it that the Iranians didn't back down so Trump is trying a different approach? Was it always just a bluff? Or is he still saying, "do as we tell you, or else?" [embedded content]

This post is a review of British historian Adam Tooze's histories of WWII (The Wages of Destruction) – and of WWI (The Deluge), which Alastair Crooke applies to current world affairs based on US strategy to diminish political and economic rivals through economic (trade) policy that is really economic warfare. He posits that Tooze's work establishes a precedent for thisStrategic Culture FoundationThe Great Switch: The Geo-Politics of Looming Recession Alastair Crooke | founder and director of...

There are continual Twitter type debates and Op Ed/Blog-type articles going on about whether MMT says this, or that, or something else. The critics are refining their attacks by hammering on about “printing money” and hyperinflation, and, more recently that MMT ignores ‘power’ (whatever that is). The latter leads them to conclude that MMT is thus a naive approach and is inapplicable to a political agenda aiming at changing things for the better. These debates (if you can call them that) are...

Larry Summers attracted a great deal of attention with arguments that post-Keynesian theories ought to be taken into account, and the ability of central banks to stimulate the economy are limited. One could argue that the zeitgeist is shifting in the direction of Modern Monetary Theory (MMT): the role of fiscal policy may be increasingly important. However, I am unsure how far actual economics debates will shift.One may note that Summers dodged discussing MMT in his initial tweets; in fact,...