OK, I'm reading WaPo (don't be hatin'), a recent piece by that ever-zealous advocate of free market capitalism, Fareed Zakaria. Mr. Zakaria says he has spoken with a number of business leaders who are supporters of Obama (unbelievably, there still are some) but are concerned about his administration and its complete lack of business acumen. [...]
Us bumpkins out here in the unwashed masses (read: those of us who don't hold PhD's in economics and work for a central bank) might think that "Neither a borrower nor a lender be" are words to live by. But boy, lemme tell ya, them folks with them there high-falutin' edumacations have got it all [...]
Hubris (also hybris; pronounced /hju:bris/) means extreme haughtiness or arrogance. Hubris often indicates being out of touch with reality and overestimating one's own competence or capabilities, especially for people in positions of power. In this recent essay, Richmond Fed staff economist Kartik Athreya makes his case: "Economics is Hard. Don’t Let Bloggers Tell You Otherwise". [...]
Tomorrow! Tomorrow! I love ya Tomorrow! You're always A day away! The Toronto G-20 summit was a colossal flop. The statement issued on their brand-new G-20 website includes ridiculous pablum like this: ...advanced economies have committed to fiscal plans that will at least halve deficits by 2013... Hey, look! We're gonna return to lower deficits [...]
On June 2nd, 3rd and 4th, respectively, I reported a growing chorus of financial pundits were going on record and warning of a coming sovereign debt crisis. Most of you are aware of the G-20 meeting that is closing in Toronto tonight. The G-20 members are a self-appointed group of governments and various government agency, [...]
Orwell would be proud. Orszag exit reveals deficit policy split (Financial Times free subscription required) Peter Orszag, Barack Obama’s budget director, resigned this week partly in frustration over his lack of success in persuading the Obama administration to tackle the fiscal deficit more aggressively, according to sources inside and outside the White House. Mr Orszag, [...]
See video below. Investor Hugh Hendry understands George Soros: "The richest people on the planet become socialists"; "Socialism is when you build a moat around the castle." Mr. Hendry is responding to a recent Bloomberg interview in which Soros decried German determination to cut their deficit spending (Imagine their arrogance!). Citing the "needs" of other [...]
We are come hither to preserve the poor commonwealth of Virginia, if it can be possibly done: something must be done to preserve your liberty and mine. - Patrick Henry, 5 June 1788, arguing (correctly) against Virginia's ratification of the proposed Constitution. We turn our attention for a foray into history. It's been said that [...]
History doesn't repeat, but it sure as heck rhymes. That's why some of us are troubled by the parallels between our current fiscal situation and the response by various levels of government to the West's most memorable brush with severe financial turbulence since the 1930's. We have too much debt; by that, I mean personal [...]
(Data sources are US CBO and Federal Reserve) The chart above (click, then click again to enlarge) shows three data sets: 1) in red, the federal budget deficit; 2) in dark blue, US Gross Domestic Product (GDP), the supposed size of the US economy; 3) in highlighted light blue, shows what US GDP would be [...]
Far from being an effective measure that protects anyone but the banks, the Senate's Financial Reform Bill is itself a testament to the power of money. Two thousand banking lobbyists descended on Washington to ensure that any effective restrictions on banks' power and guaranteed profitability were stripped away. They succeeded. The bill does virtually nothing [...]
In this final installment, I want to emphasize the connection between economics and politics. In my mind the two are interwoven and inseparable. Economics is about who produces what, and politics is about who gets to keep it. The political system is exactly as virtuous as are the people who comprise it. Activity in the [...]
