1.0 Introduction Stefano Perri has a working paper, "Sraffa's response to Eaton's review: a note on the standard commodity and Marx's general profit rate". In this post, I present the analysis rewritten in matrix notation. The claim is, more or less, that the rate of profits in the system of prices of production is the weighted average of the rates of profits, by industry, in the system of labor values. Each weight is the product of the labor value of capital advanced in that industry and...

Housing update: sales have bottomed, prices in process  – by New Deal democrat No important economic news today. Yesterday existing home sales were released, but their economic impact isn’t all that important, except as it can confirm what has been happening with new houses under construction. And confirmation is what it gave us. First, *sales* of houses have bottomed, following the peak in mortgage rates over 7% at the end of last October....

Kevin Drum points to an obscure, but radical proposal to change the way the US government does benefit cost analysis. The Office of Management and Budget has released draft guidance saying One practical approach to implementing weights that account for diminishing marginal utility uses a constant-elasticity specification to determine the weights for subgroups defined by annual income. To compute an estimate of the net benefits of a regulation using this approach, you first compute...

from Lars Syll American economist Hyman Minsky described capitalism as a “two price” system. On one side are asset prices—both financial, like government or corporate bonds, and physical like residential or commercial property. On the other, there are consumer prices—goods and services that determine current output and consumer price inflation. In the contemporary global economy, asset prices are much more sensitive to interest rate adjustments than consumer prices. The present value of...

Η «χάρτινη» οικονομία, η επερχόμενη καταιγίδα και η ανάγκη στήριξης της αντικαπιταλιστικής Αριστεράς Στ. Μαυρουδέας Καθηγητής Πολιτικής Οικονομίας, Πάντειο Πανεπιστήμιο Τα κόμματα του συστημικού κυβερνητικού τόξου (ΝΔ, ΣΥΡΙΖΑ, ΚΙΝΑΛ-ΠΑΣΟΚ) διαγκωνίζονται σε προεκλογικές υποσχέσεις παροχών προς τους εργαζόμενους και τα λαϊκά στρώματα τάζοντας «χρυσά κουτάλια». Οι ίδιοι που επέβαλαν τρία μνημόνια λιτότητας στο λαό και αύξησαν τις οικονομικές ανισότητες στα ύψη, έρχονται σήμερα...

This is a very short note, prompted by the increasing fears of the default and its consequences, which I think it's greatly exaggerated, and the relatively optimistic views about the effects of monetary tightening. Sure enough, as I noted recently, an adjustment, and lower spending, associated either with an agreement with Congress Republicans (very unlikely) or as contingency plans (14th Amendment of other solutions) are implemented, could certainly through the economy into a recession. But...

[embedded content] Jean-Paul Sartre, Roland Barthes, Simone de Beauvoir, Gilles et Fanny Deleuze … Jack Lang … André Glucksmann, et bien d’autres encore; tous font partie des 69 intellectuels français qui, aux côtés de l’écrivain Gabriel Matzneff … ont signé une tribune publiée le 26 janvier 1977. D’abord dans Le Monde puis dans Libération pour défendre trois hommes incarcérés depuis plus de trois ans pour avoir abusé sexuellement de mineurs de moins de 15 ans. ‘Trois...

As of today, Trump seems well-positioned to win the Republican nomination.  The basic dynamic is familiar from 2016 – Trump has a strong base of committed supporters, the opposition will likely be divided, and many Republican primaries are winner-take-all or winner-take-most.  Couple this with the bump in support Trump got after his indictment in NY, the apparent missteps and general unlikeability of his chief rival DeSantis, and the fact that Trump...

Jobless claims: yellow caution flag persists  – by New Deal democrat In response to last week’s big jump in new jobless claims to 264,000, I wrote that it might be an outlier vs. the beginning of a rising trend. This morning claims fell back to their previous average range, at 242,000. The 4 week average declined -1,000 to 244,250, while continuing claims from the previous week declined -8,000 to 1.799 million: I’ve been paying particular...

Democracy Alerts – Democrats Reintroduce Bill to Expand U.S. Supreme Court – Democracy Docket, I am certain this bill will not pass in the House. In any case, it puts SCOTUS on alert as to their politics. I would like to see Congress develop a code of ethics for SCOTUS which might go further than stacking the court with more justices. Ethical behavior on the part of justices plays into how they rule in some instances. It is all in appearances....