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The Dutch September HICP inflation rate was 17,1%. One year ago it was 3,0%. Below, I will argue that this is a sign of kind of war economy, not of a cyclically overheated economy. Ways to mitigate inflation were pioneered by the English economist John Maynard Keynes in his ‘How to pay for the war‘. it’s useful to go back to his ideas. The first version was published in three parts in The Times of november 1939. It was partly based on his experiences in World War I and partly on the...

Modest growth continues.The data keeps telling me the rate hikes are helping the economy rather than hurting it: This is nominal, not adjusted for inflation, and there is no evidence of rate hikes slowing anything down: Same here for inflation-adjusted consumption: Too soon to say it is turned up, but better than expected and not indicating a recession: “The University of Michigan consumer sentiment for the US was revised lower to 58.6 in September of 2022 from a...

I wrote a piece for the Guardian, urging the Queensland government to hold the line on its plan to close a tax loophole for wealthy investors, in the face of a ferocious Murdoch media campaign, and sabotage from the Perrottet government in NSW. Sadly, just as I submitted it, the government caved in. But the critique of the Courier-Mail might get a run on Media Watch. Anyway, here it is The Queensland government’s announcement that it is closing a loophole in the land tax system,...

I wrote a piece for the Guardian, urging the Queensland government to hold the line on its plan to close a tax loophole for wealthy investors, in the face of a ferocious Murdoch media campaign, and sabotage from the Perrottet government in NSW. Sadly, just as I submitted it, the government caved in. But the critique of the Courier-Mail might get a run on Media Watch. Anyway, here it is The Queensland government’s announcement that it is closing a loophole in the land tax system,...

This is my second post on the recent troubles with Sterling. In the first, I discussed vibes, mood, and animal spirits. I do think that is the best way to think about what’s going on, but I promised to write as an economist typically do (not as we all our in this case). The basic facts are that Chancellor Kwasi Kwarteng announced a mini-budget revision including elimination of the 45% income tax bracket. Oddly many financiers who would directly...

from Lars Syll It may be argued … that the betting quotient and credibility are substitutable in the same sense in which two commodities are: less bread but more meat may leave the consumer as well off as before. If this were, then clearly expectation could be reduced to a unidimensional concept … However, the substitutability of consumers’ goods rests upon the tacit assumption that all commodities contain something — called utility — in a greater or less degree; substitutability is...

No recession here: Permits for new home construction are down from the post-Covid bounce but remain above pre-Covid levels: New home sales recovering from rate hike fears and returning to pre-Covid highs, as in fact rate hikes increase gov deficit spending on interest expense paid to the economy, adding to incomes and spending:

Back in 2011, I wrote a post arguing that self-defense (including collective self-defense) is justified only to the extent of restoring the status quo ante bellum. That is, having defeated an aggressor, a country is not justified in seizing territory, unilaterally exacting reparations or imposing a new government on its opponent. Conversely, and regardless of the alleged starting point, countries not directly involved should never recognise a forcibly imposed transfer of territory...