Tag Archives: US/Global Economics

by Joseph Joyce The 2019 Globie: “Capitalism, Alone” by Branko Milanovic The time to announce the recipient of this year’s “Globie” is finally here. Each year I choose a book as the Globalization Book of the Year. The prize is—alas—strictly honorific and does not come with a monetary reward. But it gives me a chance to draw attention to a book that is particularly insightful about some aspect of globalization.  Previous winners are listed at the...

How Long Will US Foreign Net Income Dark Matter Continue? The United States became a net foreign debtor in 1985. With current account deficits every year since then, net foreign indebtedness has steadily increased since and reached a reported total of -$10.56 trillion as of Sept. 30 this year, a substantial total. However, while many have long predicted that this mounting net foreign indebtedness would eventually lead to the US also having a net negative...

December starts out with a thud The first reports in December are in, and both were negative. Let’s start with construction spending. Overall construction spending declined -0.8% in October. The more leading residential construction spending declined -0.9%, the second decline in a row (blue in the graph below): Figure1 Since actual spending on residential construction doesn’t take place until the house is started, it lags building permits (red in the...

Forecasting the 2020 election: the economic baseline (or, don’t count on a recession) Four years ago, I decided to use my set of “long leading indicators” to forecast the 2016 election. The indicators were very weakly positive, and pointed to a narrow popular vote win for the incumbent party one year out. This prompted Nate Silver to huff and puff that nobody knew anything about what the economy would look like so far off. One year later, the economy was...

by Eric Kramer The Case for Carbon Taxes, Part II:  Political Sustainability In a prior post, I argued that carbon taxes are not vulnerable to political subversion by hostile courts and regulators, and that this is an important advantage of carbon taxes over traditional regulation based on mandates, and also an advantage over subsidies.  Once they are passed, carbon taxes can work more or less on auto-pilot to drive a clean energy transition, unless they...

Via Naked Capitalism  comes an explanation of what income inequality looks like in the US.  It stands in contrast to the Bloomberg article pointed to by Yves in her introduction.  I pulled the quotes with a non-economic person in mind. THE WOLF STREET REPORT    transcript of podcast by Wolf Richter. Subprime doesn’t mean poor or uneducated. Subprime means having a credit score below 620… (Dan here) For example: Aggressive subprime lending went into...

The Current State of the U.S. Dairy Industry  I had to endure a discussion of the plight of American dairy farmers where Trump’s trade policies were somehow to blame. Stephanie Mercier confirmed some of the facts: According to data reported by the National Farmers Union (NFU), the average dairy farm has shown a positive net income only once in the last decade, in 2014. In 2018, the average value of production exceeded the total cost of producing each...

by Eric Kramer The Case for Carbon Taxes, Part I:  Political Subversion Economists support carbon taxes on efficiency grounds.  By putting a price on carbon dioxide emissions, a carbon tax creates a strong incentive for people reduce their carbon footprint.  They can do this by switching to clean technologies or simply by reducing their use of fossil fuels – by driving less or turning down the air conditioning, for example.  Other policies can also be...

Bicycles and Wine Tariffs Jeffrey Frankel has a must read blog over at Econbrowser: The “bicycle theory” used to be a metaphor for international trade policy. Just as standing still on a bicycle is not an option — one has to keep moving forward or else the bike will fall over – so it was said that international trade negotiators must continue to engage in successive rounds of liberalization, or else the open global trading system would be pulled down by...

A few thoughts while you are digesting Thanksgiving dinner There was a bunch of data released Wednesday, while yours truly was on the road along with everybody else. So here are a couple of thoughts for you as you sit there with your loosened belt figuring out what leftovers you’re going to be eating for the next few days . . . Initial jobless claims declined back to their recent baseline last week, so the four week average declined slightly, further...