Economics

18

The buck stops here

Sam Burmingham, founder and editor of the WeMoney Newsletter, has written an entertaining article on his blog on attribution theory. Sam’s article is provided below for your reading pleasure. As always, comments are welcome. The events of the past few weeks have been the perfect reminder of a concept that struck a chord with me

24

Macro 101 – Reserves and interest rates

It has been quite some time since I did a post in the Macro 101 thread. There has simply been too much economic news to process lately. However, now that the stock markets seemed to have stabilised themselves at a lower base, and the western world has set itself up for a recession I think

46

Rethinking economics

Back in April I wrote a post titled “We’ve lost our way”. The point of the post is captured in the following paragraphs So after years of a China driven mining boom that continues to adjust our terms of trade ever upwards how did we get here? How is it possible that after so much

38

Weekend Musing: The People’s Budget

It’s the Saturday, which means its time for some CC and a weekend musing. Last weekend’s musing on the public expenditures of first-world governments produced a lot of interesting debate.  My premise was that current levels of spending on non-capital items – primarily welfare and healthcare – were increasing quicker than GDP.  Politics aside, the math

149

Weekend Musing: The problem with democracy

It’s the weekend and I’m on my third Canadian Club. So to hell with it, I’m going to step outside my usual dry realm of equities analysis and get a little philosophical. Tonight I want to have a chat about what I see as a major flaw in modern liberal democracies – namely, their tendency

23

Would you Twizy ?

A little off topic tonight, but hopefully not too far. One of the things I used to talk about on my old blog was a concept I called GPEC. I am not going to discuss it again here, but basically it is a measure that I suggest government economic policy should be judged by. GPEC

18

Google and correlation madness

Some of you may have heard of Google Trends, a useful tool from Google that lets you plot the activity of popular Google search terms over time. As noted by Justin Wolfers at the Freakonomics blog, there are already some pretty useful applications of this tool; most notably, Google Flu Trends, which uses Google’s search

34

Scarcity vs abundance II

Last weekend I looked at issues of scarcity and abundance, and how that really needs two economic theories for late stage capitalism, or post-capitalist societies, as Peter Drucker described it. One for what is scarce, using “laws” of supply and demand. The other for what is not scarce (the “knowledge economy”, for instance) which is

48

The abundance of scarcity (and vice versa)

In response to my post last weekend on the emergence of meta-money, a hall of mirrors, in global finance, a US reader, Toby, said something that really had me thinking. This is a very important article which, sadly in my view, does not address Perpetual Growth, a key component of the challenges facing humanity. There

46

Overruled

Ok, we all know that anyone who says “this time it is different” is to be treated at best as misinformed, at worst as a fool. “They are the five most dangerous words in the English language” etc. etc. But, to repeat my question: “Are things always the same?” Mostly, yes. Modern housing bubbles are

72

Abolish the RBA

There is absolutely no evidence or even studies to produce evidence that the RBA provides any value to the Australian people. Anything the RBA does could be undertaken by the private banking sector. In fact the RBA can only perform three types of tasks. Tasks that the private sector would or are undertaking given the

34

I want my nanny (state)

Cameron Murray is a blogger that many of the MacroBusiness readers may have read previously. He has a blog called Observations of an Environmental Economist which I followed until Cameron announced his retirement from blogging last year. I have always enjoyed his blog because it presents some refreshing views on a number of topics and

28

Endless regress

My estimable co-blogger Delusional Economics showed he was anything but delusional with his penetrating commentary on economics as an ideology (Economic Ideologies). It is a point made all too rarely. That economics purports to be an unbiased way of understanding financial and commercial behaviour when it is in fact riven with political assumptions and beliefs.

6

CDS: More liquidity, more risk

By Satyajit Das In an opinion piece entitled “Hedging bans risk pushing up debt costs” published on 9 March 2011 in the Financial Times, Conrad Voldstad, the chief executive of the International Swaps and Derivatives Association (“ISDA”) and formerly a senior derivatives banker with JP Morgan and Merrill Lynch, made the case against the EU

59

Economic ideologies

There is common thread across modern economics. Not something that is useful. It is the fact that no one really seems to know what the hell is going on. Yes there are some people who are seen as “prophets”, depending on your ideology they may be anyone from Mr Buffet to Mr Kaiser. But economics

13

Guest Post: Leigh Harkness

I discovered Leigh Harkness’s web site a few months ago while doing some research on foreign trade.  His site so intrigued me that I contacted him to see if he would be interested in doing a series of guest posts about his research and experience in his little understood area of economics. Leigh accepted my

3

Guest post: Derivatives regulation Part II

By Satyajit Das A question of values … Derivative contracts are valued on a mark-to-market (“MtM”) basis. This requires valuation of the contracts based on the current market price. OTC derivatives trade privately. Market prices for specific transactions are not directly available. This means current valuations rely on pricing models. In current accounting argot, most derivatives are Level 2

21

Macro 101 – Foreign debt

There have been a few posts on this blog recently about the fiscal position of the United States. The Unconventional Economist gave a somewhat Austrian perspective on the situation only to be jousted by Rotten Apple from what obviously is a chartalistic view of money. I don’t think I need to add anything more to either view, but

23

Macro 101 – Bank operations

With the slow gurgling sound of  the lack of retail spending by the public in my ear, it is time to get back to my other stream of conversation.  I am going to continue on with my macroeconomics series. Today I am going to talk about banks and how they operate in the context of macroeconomics

10

Reader’s Question: Another visit to CentralBankopia

We received an e-mail from David this week. I really love your blog, and “get” nearly all the concepts on there now, but the one that I’ve never been able to grasp is your fiat currency “just print money” centralbankopia… You seem to be suggesting that the Federal Reserve should just “print money” as/when required,