Category: economics

A Good Idea, Even if It’s From Republicans

robertreich: A group of former Republican officials (including James A. Baker, Henry Paulson, George P. Shultz, Marty Feldstein and Greg Mankiw) is proposing a carbon tax starting the tax at $40 per ton, that would gradually increase.  The proceeds of the tax would be distributed to every American. The average family of four would receive… Continue reading A Good Idea, Even if It’s From Republicans

Repeal of liquidation tool would be a major unnecessary error

The OLA is a new bankruptcy-type provision included in Dodd-Frank that gives the Federal Deposit Insurance Corporation the authority to resolve insolvent systemic financial institutions (think future Lehman-like episodes). It allows the FDIC to borrow funds from the Treasury to support the liquidation of such firms with the proviso that in the event of any… Continue reading Repeal of liquidation tool would be a major unnecessary error

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The unemployment rate in the city of Seattle – the tip of the spear when it comes to minimum wage experiments – has now hit a new cycle low of 3.4%, as the city continues to thrive. I’m not sure what else there is to say at this point. The doomsayers were wrong. The sky… Continue reading Untitled

Donald Trump’s trade team has based their analysis on a remarkably silly mistake

Donald Trump’s trade team has based their analysis on a remarkably silly mistake

Reading this, you might wonder why it is that in the real world, economists actually do try to develop complex computer models of the economy. The answer is that the alternative method Ross and Navarro are proposing doesn’t even remotely work.

This is 101ism. The idea that a simple Econ-101 level understanding of a topic will just scale up to the macro level. The assumption that every market will work like a guns and butter chart from day three of Econ 101 is easily disproved, but this doesn’t stop 101ism. People like simple solutions. This DSGE charts are hard, have Greek letters and lots of math. 101ism sells.

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@TBPInvictus here: In light of a recent monthly release from the Bureau of Labor Statistics (BLS), time for a quick trip to the glorious pacific northwest and the Seattle, WA area to revisit what’s been happening there in the wake of that city’s rising minimum wage. You may recall that even prior to Seattle’s minimum…Read… Continue reading Untitled

TheMoneyIllusion » Trump favors teasier money

TheMoneyIllusion » Trump favors teasier money

So what are Trump’s views? Very simple. For elderly savers, Trump favors higher interest rates. For big developers, he favors low rates. For consumers, he wants a strong dollar. For exporters, he wants a weaker dollar. Each group will get what they want, but not all in the same universe. You see, Trump’s monetary views are best described as a wave function, which will collapse to a single outcome on January 20th. Trump is the first post-modern candidate, the first to understand that truth is what the voters let you get aways with, and that the multiverse offers the possibility of achieving seemingly irreconcilable aims.