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Still decelerating, and data releases seem to confirm that the credit deceleration is reflecting something similar in the macro economy: Annual growth is down to about 1.5%: This would have been maybe $500 billion higher if it had not decelerated: Housing and cars contribution to growth also looking a lot lower than last year: This chart is only through year end. It’s since decelerated as per the above current charts. Note how the downturn in credit growth tends to lead...

from Dean Baker In the last couple years, the financial transactions tax (FTT) has moved from a fringe idea to a policy proposal treated seriously by even the mainstream of the Democratic Party. The decision by Senator Bernie Sanders to make it a central part of his presidential campaign certainly helped, but a number of members of Congress, including Keith Ellison and Peter DeFazio, have also pushed FTT proposals for many years. The FTT is also gaining momentum overseas. There’s a push...

from David Ruccio Sometimes you just have to sit back and admire capitalism’s ingenuity. It’s able to make profits twice over. First, capitalists know that, when they keep workers’ wages down—even when there’s “full employment”—they can make spectacular profits. And, second, they can make additional profits by loaning money to those same workers, who are desperate to purchase goods and services and send their children to college, thereby financing the demand for the goods and services...

from Lars Syll Some time ago yours truly ventured to question Paul Krugman for his unadulterated devotion to the IS-LM model. For years self-proclaimed “proud neoclassicist” Paul Krugman had in endless harpings on the same IS-LM string told us about the splendour of the Hicksian invention. Krugman’s response contained nothing new. In an earlier post on his blog, Krugman had argued that ‘Keynesian’ macroeconomics more than anything else “made economics the model-oriented field it has...

The Fed continues to fail to meet it’s target. They just need a little more time… ;)And coincidentally this is inline with the credit deceleration as previously discussed: Highlights In what is one of the very weakest 4-month stretch in 60 years of records, core consumer prices could manage only a 0.1 percent increase in June. This is the third straight 0.1 percent showing for the core (ex food & energy) that was preceded by the very rare 0.1 percent decline in March....

Mitch McConnell and the Republicans in the Senate are not satisfied with the Tom Price appointed CBO chief, who insists that there are four fingers in front of his face and apparently won’t make numbers up to help take away health insurance from 22 million people. So Mitch McConnell and the Republicans will rely upon, and I am not making this up, “ALTERNATIVE SCORING” to further the Ted Cruz amendment to Obamacare repeal through the Senate. Republicans are...

Still soft, also somewhat in line with decelerating bank mortgage lending: Highlights Purchase applications for home mortgages fell a seasonally adjusted 3 percent in the July 7 week, while applications for refinancing fell 13 percent from the previous week to the lowest level since January 2017. The refinance share of mortgage activity fell 2.8 percentage points to 42.1 percent. The decline in applications was registered despite adjustments for the Fourth of July holiday. On...

House price developments in the EU show large differences in development – which makes the task for monetary and fiscal policy even more difficult. One of the beneficial consequences of the Great Financial Crisis is that economic statisticians at for instance Eurostat or the Bank for International Settlements spend more effort on assembling house prices , though The Economist deserves praise as it led the way about 15 years ago. What do these data tell us? Low interest rates are...

On Tuesday 16th of March 2017 Robert Skidelsky and I launched my book The Reformation in Economics in the Clement Attlee room in the House of Lords. It has taken some time to upload these videos of Robert’s and my comments. Most of the speeches were captured but I have included my own text below (I did not end up sticking to the written comments verbatim). On a separate note, Brian Romanchuk has written a short review of the book here. [embedded content] [embedded content] Hi...