Espace. Space2. Work. Government debt explained (in a few minutes) AlterNet: System Failure: We Are Approaching the End of Society As We Know It -- And That May Be a Good Thing. Benoit Mandelbrot: Fractals and the art of roughness. World. Emptress. Management. Play 'corporate òr state' publishing power. eCommerce. Financial Crisis' Shopping. 10 Skills Every Survivalist Should Learn.
Jhagey2. "The Usual Suspect" by J. Bradford DeLong. Exit from comment view mode. Click to hide this space BERKELEY – Across the Euro-Atlantic world, recovery from the recession of 2008-2009 remains sluggish and halting, turning what was readily curable cyclical unemployment into structural unemployment. And what was a brief hiccup in the process of capital accumulation has turned into a prolonged investment shortfall, which means a lower capital stock and a lower level of real GDP not just today, while the recovery is incomplete, but possibly for decades. One legacy of Western Europe’s experience in the 1980’s is a rule of thumb: each year that lower labor-force attachment and reduced capital stock as a result of declining investment depresses production $100 billion below normal implies that productive potential at full employment in future years will be $10 billion below what would otherwise have been forecast.
The fiscal implications of this are striking. Now this is, to say the least, a highly unusual situation. "Schumpeter Calls Krugman" by Michael Heller. In the noisy urgent quarrel about economic crisis almost everybody is asking how to get out of recession or how not to get into recession. You’d be forgiven for thinking the menu boils down to “growth or austerity”, like a limited choice of “rabbit or fish” in a poor pueblo or kampung restaurant.
Recently Paul Krugman complained to his son with characteristic biting humor:“Standard economics in this case — that is, economics based on what the profession has learned these past three generations, and for that matter on most textbooks — was the Keynesian position. The austerity thing was just invented out of thin air and a few dubious historical examples to serve the prejudices of the elite. And now the results are in: Keynesians have been completely right, Austerians utterly wrong — at vast human cost… Nobody ever admits that they were wrong, and Austerian ideas clearly have an emotional and political appeal that is resilient to any and all evidence.” Subscribe to PS Digital Subscribe Now 1. "Schumpeter's Opinion of Budget Deficits" by Michael Heller. I let the following quote speak for itself, and hope to return soon to draw out more substantive points relating to policy during a recession.
Schumpeter was writing in 1941. Note in passing, Barry Eichengreen’s remark that Schumpeter “was a skeptic of all things Keynesian, given his self-conscious competition with Keynes for the mantle of greatest economist of the 20th century”. The readiness to let a budget run into a deficit in a depression by keeping up expenditures in the face of shrinking revenues is a policy which will alleviate much suffering and keep many things going which would otherwise crash.
This is so and cannot be denied, and action along these lines has been taken consciously or unconsciously for more than a hundred years… The interesting thing is not so much the degree to which remedial effects can be attained in that way; the interesting fact is the spirit in which the policy was entered into… and the way in which it was made permanent. "Down with Debt Weight" by Robert Skidelsky. Exit from comment view mode. Click to hide this space LONDON – Nearly four years after the start of the global financial crisis, many are wondering why economic recovery is taking so long. Indeed, its sluggishness has confounded even the experts. According to the International Monetary Fund, the world economy should have grown by 4.4% in 2011, and should grow by 4.5% in 2012. In fact, the latest figures from the World Bank indicate that growth reached just 2.7% in 2011, and will slow this year to 2.5% – a figure that may well need to be revised downwards.
There are two possible reasons for the discrepancy between forecast and outcome. Either the damage caused by the financial crisis was more serious than people realized, or the economic medicine prescribed was less efficacious than policymakers believed. In fact, the gravity of the banking crisis was quickly grasped. As a result, the slide was halted, and the rebound was faster than forecasters expected. CENSORSHIP OF INTERNET AND SOCIAL MEDIA. Don't Sweat the Bond Markets. The ongoing eurozone debacle has driven home certain straightforward lessons: the fiscal rules enshrined in the EU's 1997 Stability and Growth Pact had almost no teeth, government bonds of EU nations are not a risk-free asset, and voters do not readily tolerate economic austerity.
Beyond these, however, the last few years have also contained subtle lessons about the relationship between governments and capital markets. More specifically, they have shown that our understanding of the pressures that private capital markets place on governments is incomplete. Although holders of government debt certainly would react markedly to a change in the membership of the eurozone, they would not likely react strongly, or over the longer term, to many other government policy decisions and political outcomes. And these reactions have varying consequences for governments, depending on how governments have managed their debt profiles.
To continue reading, please log in. Don't have an account? Register. The Truth Revealed About Debt and Deficits. April 18, 2012 | Like this article? Join our email list: Stay up to date with the latest headlines via email. It’s hard to open a newspaper or turn on the TV without being bombarded with narratives suggesting that fiscal policy didn’t work and that we therefore need discipline in the form of balanced budget amendments and debt limits.
But most of this talk arises from a fundamental misunderstanding about the way debt and deficits actually operate. Private v. When people talk about reducing the deficit, the message is that the U.S. government is running out of money. They all warn we have to cut excessive debt. The truth is that a holder of private debt, like a household, has a very different relationship to debt than a government like the United States, which issues its own currency. In today's economy, private debt loads --those carried by families and businesses -- remain too high while income and employment continue to fall, and delinquencies and foreclosures continue to rise. Fr££d0mOfSp££cH. The New Economy Movement | COC. 5 Big Ideas For A New Economy. An exciting moment is upon us, where some of the assumptions that have long governed our economy are beginning to unravel.
There is the possibility that we could come out of this recession with a new concept of what the economy is, who it serves, and how it works. Reflecting on history, we know that moments for truly re-thinking the economy are scarce. The replacement of mercantilism with liberal economic theory was such a moment. The Keynesian revolution was another. But where will this current moment of crisis take us? Will we succeed in powering a new economy? What ideas and solutions will enable our transition to a new economic paradigm? The truth is that it is actually up to us to decide what is to be on the menu of new economic thinking; what ideas take hold, what solutions gain staying power.
Shift from outsourcing to insourcing Access the wealth of the (hyper) local The Internet has provided a new local, one that is based around markets and themes instead of geographies. Are the "commons" a metaphor of our times? By Jesús Antón, OECD Trade and Agriculture Directorate, and Jeff Dayton-Johnson, Monterey Institute of International Studies The late Argentinian writer Jorge Luis Borges wrote that "Perhaps universal history is the story of a handful of metaphors". By that standard, Elinor Ostrom's contribution has been huge, for over the years she has been responsible for a new and powerful metaphor–that of the local commons and their economic governance–which underpins so much global public policy debates.
Markets and state-managed institutions are not always well suited to managing common-pool resources, such as water catchments, river fisheries or nearby pasture lands. Resources have to be managed sustainably over time, and market prices and government rules might not be able to deliver the most effective solutions. But as Ms Ostrom argues, the commons metaphor can be applied beyond the local management of natural resources. Elinor Ostrom’s work focuses on what is termed “common-pool resources”. International. Calls for urgent action to boost ailing global economy. Central Banks to the Rescue: Should We Be Encouraged or Terrified? - Jim Tankersley - Business. Strong action by the world's stewards of monetary policy was necessary -- for now. Hardly anyone believes that the central banks' actions are more than scotch tape over a shattered EU. Central bankers around the world are very, very worried about Europe, and they're starting to do something about it.
This is equal parts terrifying and encouraging. That's the critical takeaway from the liquidity injection - a fancy way of saying, turning up the spigot on global lending - embarked upon on Wednesday by the Federal Reserve, the European Central Bank, and four other central banks from around the globe. The substance of the announcement, though, is far less important than the symbolism. "It doesn't change any of the fundamental issues in Europe," Michael Cloherty, a researcher for Royal Bank of Canada Capital Markets, wrote in an analyst note on Wednesday. Ben Bernanke and his fellow chief central bankers may be our best hope to prevent one. Things have worsened. Chicago Booth Blog: Fault Lines by Raghuram Rajan - Fault Lines by Raghuram Rajan. CHICAGO – Poor Ben Bernanke! As Chairman of the United States Federal Reserve Board, he has gone further than any other central banker in recent times in attempting to stimulate the economy through monetary policy.
He has cut short-term interest rates to the bone. He has adopted innovative new methods of monetary easing. Again and again, he has repeated that, so long as inflationary pressure remains contained, his main concern is the high level of US unemployment. What more could they possibly want? The answer lies in their view of the root cause of continued high unemployment: excessively high real interest rates. An important source of aggregate demand has evaporated. This is a different logic from the one that calls for inflation as a way of reducing long term debt (at the expense of investors), but it has equally serious weaknesses. Alternatively, low interest rates could push her (or her pension fund) to buy risky long-maturity bonds. We cannot ignore high unemployment. Global Recession Looms as Euro Crisis Deepens. Costas Lapavitsas: Crisis deepens as Germany fails to sell-out 10 year bonds; the public must take over the financial system - Bio Costas Lapavitsas is a professor in economics at the University of London School of Oriental and African Studies.
He teaches the political economy of finance, and he's a regular columnist for The Guardian. Transcript PAUL JAY, SENIOR EDITOR, TRNN: Welcome to The Real News Network. I'm Paul Jay in Washington. And on Wednesday it was announced that German ten-year bonds that were for sale, only somewhat over half were actually sold. End of Transcript DISCLAIMER: Please note that transcripts for The Real News Network are typed from a recording of the program. Comments Our automatic spam filter blocks comments with multiple links and multiple users using the same IP address. Universal social net good macroeconomics. J. Ghosh: A safety net helps to raise wages and create real demand - Bio Dr. Jayati Ghosh is Professor of Economics and currently also Chairperson at the Centre for Economic Studies and Planning, School of Social Sciences, Jawaharlal Nehru University, New Delhi.
Educated at Delhi University, Jawaharlal Nehru University and the University of Cambridge, England, her research interests include globalization, international trade and finance, employment patterns in developing countries, macroeconomic policy, and issues related to gender and development. Among other books, she has co-authored (with Prof. C.P. She is one of the founders of the Economic Research Foundation in New Delhi and is on the board of various other social research organizations. Transcript PAUL JAY, SENIOR EDITOR, TRNN: Welcome to The Real News Network. End of Transcript DISCLAIMER: Please note that transcripts for The Real News Network are typed from a recording of the program. Comments. Max Keiser TV.
History of the Current Crisis. Occupy Wall Street etc. Eurozone. The World Economy 2012. Capitalism vs. the Climate. Denialists are dead wrong about the science. But they understand something the left still doesn’t get about the revolutionary meaning of climate change. There is a question from a gentleman in the fourth row. He introduces himself as Richard Rothschild. He tells the crowd that he ran for county commissioner in Maryland’s Carroll County because he had come to the conclusion that policies to combat global warming were actually “an attack on middle-class American capitalism.”
About the Author Naomi Klein Naomi Klein is an award-winning journalist, syndicated columnist, fellow at The Nation Institute and author of the... Also by the Author Some of big green's most powerful players still invest in energy companies. Some mainstream environmental organizations are trying to wean themselves from fossil fuel investments—but some aren’t. Claiming that climate change is a plot to steal American freedom is rather tame by Heartland standards.
Equally significant has been a shift in emotional intensity. Legal / Copyright. A Colossal Fracking Mess | Business. Fracking is an energy- and resource-intensive process. Every shale-gas well that is fracked requires between three and eight million gallons of water. Fleets of trucks have to make hundreds of trips to carry the fracking fluid to and from each well site. Due in part to spotty state laws and an absence of federal regulation, the safety record that hydraulic fracturing has amassed to date is deeply disturbing. As use of the technique has spread, it has been followed by incidents of water contamination and environmental degradation, and even devastating health problems. In Dimock, where more than 60 gas wells were drilled in a nine-square-mile area, all kinds of ugly things transpired after Cabot came to town. Over a six-month period Cabot was fined $360,000 by the D.E.P. for contaminating Dimock’s groundwater and failing to fix the leaks that caused the problem.
With natural gas being heavily promoted in TV ads and by politicians and proponents such as oilman and hedge-fund manager T. Wrong-Headed on Rare Earths by Reinhard Bütikofer. Exit from comment view mode. Click to hide this space BRUSSELS – For more than two years, the world’s industrialized countries have been locking horns with China over the supply of rare earth elements, a critical component of many high-tech products. Now, these tensions may be reaching a breaking point, after the United States, the European Union, and Japan recently filed a complaint with the World Trade Organization against China’s export restrictions on a number of critical minerals, including rare earths. But a WTO case against, should it succeed, might be at best a Pyrrhic victory, and, at worst, a strategic blunder. In fact, the US-EU-Japanese troika does have a case. Nevertheless, the decision to lodge a complaint with the WTO must be questioned on three counts. First, it endangers new mines and refineries outside of China that are being planned in the coming years – and that would help to loosen China’s iron grip on supply.
Second, the timing of the complaint is all wrong. How Mozambique could shake up Putin's world. Exactly What Is Crony Capitalism, Anyway? Coronary Capitalism - Kenneth Rogoff. Blaming Capitalism for Corporatism - Edmund S. Phelps and Saifedean Ammous. Capitalism: A Ghost Story | Arundhati Roy. "Capitalism and the Ivory Tower Intellectuals" by Michael Heller. Al Gore and David Blood: A Manifesto for Sustainable Capitalism. Why the Clean Tech Boom Went Bust | Magazine. Dancing on the Sand - By Bruce Jones.
"Rio’s Unsustainable Nonsense" by Jagdish Bhagwati. "The Middle Class Goes Global" by Johannes Jütting. The Global Middle Class Is Bigger Than We Thought - By Shimelse Ali and Uri Dadush. "The Female Economy" by Nena Stoiljkovic. Workers of the World Divide. In Praise of Leisure - The Chronicle Review. "Fast Food’s “Ethnic Insights”" by Andrew Billo. Artful Dodgers - By Joshua Keating. Can We Prevent the Next Bubble? | Wired Science How the Fed Can Prevent the Next Financial Crisis. How Europe's Double Dip Could Become America's) Chicago Booth Blog: Fault Lines by Raghuram Rajan - Fault Lines by Raghuram Rajan. Cash Is Better Than Food Stamps in Helping Poor: Edward Glaeser.
Five Years After Crisis, No Normal Recovery. Innovation: Sharing the knowledge burden. Barbara Ehrenreich: Preying on the Poor. "Share the Work" by Barry Eichengreen. Can disruptive policy create a sustainable finance system? James K. Galbraith: The Final Death (and Next Life) of Maynard Keynes. ARE WE APPROACHING THE ENDGAME FOR THE EURO? The Cult of Incompetent Bankers. The God Clause and the Reinsurance Industry. The Map is Not the Territory: An Essay on the State of Economics. A Formula for Economic Calamity. Economics: Rituals of rigour. Why Economic Models are Always Wrong. What Would John Maynard Keynes Tell Us to Do Now? Is Modern Capitalism Sustainable? - Kenneth Rogoff. No easy solution. The Straits of America - Nouriel Roubini. Capitalism - What Comes Next? | Thought Economics. Debt and Dumb | Politics. Debt, Deficits, and Modern Monetary Theory — An Interview with Bill Mitchell. Wall Street Is Already Occupied. The Great Bank Robbery - Nassim Nicholas Taleb and Mark Spitznagel.
Commodity Traitors: Financial Speculation on Commodities Fuels Global Insecurity | The Primate Diaries. Buying Tomorrow. Cargill: Inside the quiet giant that rules the food business - Oct. 27. Why Do Dangerous Financial Criminals Roam Free? | Economy. Financial Reform: Unfinished Business by Paul Volcker. Michael Spence on Globalization & Unemployment. "Labor’s Paradise Lost" by Robert Skidelsky. As Banks Start Nosing Around Facebook and Twitter, the Wrong Friends Might Just Sink Your Credit | Betabeat — News, gossip and intel from Silicon Alley 2.0.
Reforming Repo Rules - Mark Roe. Swap-a-Skill.com.