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Tag Archives: Uncategorized

To What Extent Is Economics an Ideology and to What Extent Is It a Useful Theory?

By Philip Pilkington, a macroeconomist working in asset management and author of the new book The Reformation in Economics: A Deconstruction and Reconstruction of Economic Theory. The views expressed in this interview are not those of his employer Ever since the Enlightenment many societies have moved away from justifying their existence and formulating their aims through recourse to religious language. Gone are the days of the ‘Great Chain of Being’ which justified the natural and...

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US budget gap, Jobless claims, Retail employment, Rail cars

Seems revenues continue to fall indicating the two years of deceleration of growth may have already gone below 0, and with unemployment claims a lot harder to get that source of transfer payments seems to have been reduced, reducing what otherwise would have been that much counter cyclical deficit spending: US Budget Gap Doubles in December The US government reported a $28 billion budget deficit in December, a 94.4% increase from a $14.4 billion gap a year earlier and...

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Indignity of not-work?

from David Ruccio Mainstream economists and economic commentators continue to invoke the so-called “dignity of work” to criticize the idea of a universal basic income.  It’s an argument I’ve dealt with before (e.g., here and here). As I see it, there’s nothing necessarily dignified about most people being forced to have the freedom to sell their ability to work to a tiny group of employers. The idea may be intrinsic to capitalism—but that doesn’t mean it contributes to the dignity of...

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Fake pluralism

As a means of fending off criticism of its autism, of further concealing its ideological role (see below), of diverting calls for pluralism and, perhaps most of all, just as a pastime, economics’ Neoclassical mainstream plays a game of relaxing the assumptions. It loosens one or two assumptions around the edges of the theory and then does a bit of analysis. This is no better than when viewing David to lean to the left or to the right or kneel or stand tiptoed as a means of seeing another...

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Tectonics and Growth

from Peter Radford My wife is reading Kahneman’s “Thinking Fast and Slow”, somewhere in which he relates his reaction when he first came across the bedrock of mainstream economics: rational microeconomic behavior. I must admit I had a very similar reaction. The description of human behavior that underpins modern economics is so bizarre that my first thought was that it must be some form of Monty Pythonesque satire. Surely, I thought, this is a joke and in a few pages all will be revealed....

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Discount rate, Fed payment to Treasury, German trade balance, Trump communications

Note that there was little or no demand from member banks to borrow from the regional reserve banks, yet they decided the rate needed to be higher…;) All but one bank requested to raise an interest rate the U.S. central bank places on its loans to commercial banks for the month of December, according to Federal Reserve Board discount rate minutes released on Tuesday. The Federal Reserve Bank of Minneapolis asked to leave the discount rate unchanged, according to Fed minutes....

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Small business index, Redbook retail sales, Jolts, Consumer credit, Retail sales forecast

Still Trumped up expectations: Highlights The small business optimism index soared 7.4 points in December to 105.8, the highest reading since December 2004. The outsized increase far exceeds expectations and follows a robust 3.5-point rise in November. NFIB said business owners who expect better economic conditions accounted for about half of the overall increase, with a net 50 percent of respondents expecting that the economy will improve, a 38 point leap up from November....

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Labor market conditions index

From the Fed’s research: Highlights The economy may be at full employment but it’s not helping the labor market conditions index which remains flat. For the first negative score since May, December’s index comes in at minus 0.3. Based on this report, there may be more slack than suspected and less risk perhaps of wage inflation. Considered experimental, the labor market conditions index, published by the Federal Reserve, is a composite of 19 separate indicators. ...

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More evidence of early US involvement in Indian demonetisation

from  Norbert Haering When Prime minister Narendra Modi took the bulk of Indian cash out of circulation, he caused great hardship for many Indians, while a disruption-loving tech elite and political establishment asked for optimism and patience. In an earlier piece I have provided some indications for US involvement in that scheme. In this piece, I am adding some more, including earlier, evidence, summarize the evidence and ask if this evidence is reasonably compatible with the...

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European inflation is NOT soaring

Predictably (as energy prices can’t fall forever) consumer price inflation in the EU recently increased. The present level is 1,1% which is, in a historical perspective, outright low. Also, ‘core’ inflation (which, unlike consumer price inflation, has never been negative) remained subdued and even below 1%. Predictably, however, people already start to scream that inflation is soaring and we should be afraid about worthless money. They are wrong. Four reasons: Inflation does not measure...

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