Category Archives: Economic fundamentals

Economists, Wall Street Upset About Stingy Millennials

Stingy spending and investing behavior by millennials is a part of the New Normal that the officialdom would like to ignore.

View from the Past: Banks Preferred Lending to Businesses, Not Collateral

Why the rise of collateral-based lending has been bad for our economic health.

Deal With Greece Still Looks Wobbly

Negotiations with Greece remain fraught. Only a narrow path has been opened to getting a deal done, and it is far too easy for the parties, for reasons good and bad, to stray from it.

Wave of Defaults, Bankruptcies Spooks Bond Investors

Investors are exiting junk bond funds as bankruptcies rise despite the “recovery” allegedly picking up steam.

Banks are Not Intermediaries of Loanable Funds – and Why This Matters

Problems in the banking sector played a seriously damaging role in the Great Recession. In fact, they continue to. Macroeconomic models failed to explain the interaction between banks and the macro economy. The problem lies with thinking that banks create loans out of existing resources. Instead, they create new money in the form of loans. The traditional model greatly understates bank and macroeconomic risk.

At Emergency Summit, Creditors Plan to Make Greece an Offer It Can’t Refuse

A Eurogroup meeting ended if anything with Greece and its creditors even more alienated from each other.

How Overgrown Financial Service Sectors Kill Growth

It’s now becoming cutting edge conventional wisdom that oversized financial service industries are bad for your economic health. Yet the media is only occasionally and timidly is willing to say that what is good for Jamie Dimon is bad for the rest of us.

What If There is No Deal on Greece?

The alarming part of the deadlock between Greece and its lenders is the lack of a plan on the creditor side to develop a Plan B, a sort of mirror image of the Greek government’s claim that its has bet everything on securing a favorable agreement.

The Empirical Shift in Economics

What’s at stake: Rather than being unified by the application of the common behavioral model of the rational agent, economists increasingly recognize themselves in the careful application of a common empirical toolkit used to tease out causal relationships, creating a premium for papers that mix a clever identification strategy with access to new data.

Greek Talks Collapse, Default Looms

Both sides in the Greece/creditor negotiations have said they have reached the limits of what they are prepared to give.

“If You Are Not Building a Nation, Then What the Fuck Are You Doing?”

How arrogant ignorance has squandered the US position of world leadership.

Oil Markets Could Be In For A Shock From China Soon

China’s oil consumption is a bigger part of global demand than most analysts acknowledge. A slowdown in buying after China stopped stockpiling diesel for the summer Olympics was a proximate cause of the 2008 oil bust. China is again in a stockpiling phase, which could precede another not-well-anticipated demand drop.

TPP: Don Beyer (D-VA) Puts “Free Trade” Above National Sovereignty and Democracy

Debunking “free trade” and other spurious defenses of the multinational enrichment, democracy stripmining programs known as the Trade in Services Agreement, the TransPacific Partnership, and the Transatlantic Trade and Investment Partnership.

The Geopolitics of American Global Decline: Washington Versus China in the Twenty-First Century

America’s current leadership has failed to grasp the significance of a radical global change underway inside the Eurasian land mass. If China succeeds in linking its rising industries to the vast natural resources of the Eurasian heartland, then quite possibly, as Sir Halford Mackinder predicted on that cold London night in 1904, “the empire of the world would be in sight.”

G-7 Throws Greece Under the Bus

Some observers thought that Greece might get a break in the G-7 summit this weekend. While the G-7 has one more day to run, the statements coming out of the summit strongly and uniformly back the creditor position.