Posted on 26 October 2020

by Constantin Gurdgiev, TrueEconomics.Blogspot.in

My last update on Nordics vs Sweden comparatives was a month ago, although I did post some more recent data trends on Twitter since then. Here are the latest numbers.

Please share this article – Go to very top of page, right hand side, for social media buttons.

New deaths counts are relatively benign, both in Sweden and (at a higher rate) in the rest of the Nordics.

However, new daily counts in thee Nordics ex-Sweden are literally out of control as a new, and much larger wave of the pandemic sweeps EU27.

Sweden entered the second wave of the pandemic with a delay, compared to other European states, so its numbers are still lagging those in other Nordic states.

I commented on the often-heard

Posted on 25 October 2020
by John Mauldin, Thoughts from the Frontline

Appearing on 60 Minutes in 2009, Fed Chair Ben Bernanke said the recession’s end was in sight because the Fed’s asset purchases were generating “green shoots". They turned out to be slow-growing shoots. The US unemployment rate kept getting worse for seven more months (peaking in October), and needed five more years to get where it was when that recession began.Please share this article – Go to very top of page, right hand side, for social media buttons.Similarly, you can look around today’s economy and see green shoots here and there. As bad as things are – and make no mistake, they’re bad – we’ve regained some lost ground since the March/April depths. But the problem is in the “here and there" part. Some parts

Posted on 23 October 2020
by Constantin Gurdgiev, TrueEconomics.Blogspot.in

The global pandemic is accelerating, not abating. New cases numbers have set all-time records in the last two days, and daily counts ranked in top 10 in the last 10 days on eight occasions, with the balance two occasions coming in ranked 13th and 15th, respectively. Despite the rising public complacency and fatigue to the pandemic numbers, globally, we are yet to attain the first peak of the pandemic, suggesting that when this does happen, we are likely to be set for an even worse second wave of infections.Please share this article – Go to very top of page, right hand side, for social media buttons.Overall, 7-days average for new infections is at a jaw-dropping 390,097, more than 3 times the historical

Posted on 23 October 2020
by Timothy Taylor, Conversable Economist

For the 2020 election, the United States will rely more heavily on vote-by-mail than ever before. Is it likely to affect the outcome? Andrew Hall discusses some of the evidence in "How does vote-by-mail change American elections?" (Policy Brief, October 2020, Stanford Institute for Economic Policy Research).Please share this article – Go to very top of page, right hand side, for social media buttons.There are several categories of vote-by-mail. The mild traditional approach was the absentee ballot, used by people who knew in advance that they wouldn’t be able to make it to the polls in person on Election Day for some specific reason (like being an out-of-state college student or deployed out-of-state in the

Posted on 22 October 2020

by Philip Pilkington

Article of the Week from Fixing the Economists

When I was doing my undergraduate in journalism I became interested in economic reporting and commentary. One of the things that struck me was the inability of respected opinion-makers to handle data; a disease that Dean Baker documented on his Beat the Press blog. Much to my surprise when I began to study economics I found that the situation was not much better among academics and working economists. Often whole debates would disintegrate on a basic data-point.

Please share this article – Go to very top of page, right hand side, for social media buttons.

A good example of this is the case of Jonathan Finegold Catalfln, an Austrian economist and Mises.org contributor. (The

Posted on 18 October 2020
by John Mauldin, Thoughts from the Frontline

We’re caught in a trapI can’t walk outBecause I love you too much babyPlease share this article – Go to very top of page, right hand side, for social media buttons.Elvis Presley’s rendition of Suspicious Minds topped the record charts in 1969. The lyrics portray a romance that couldn’t work, but was also impossible to escape. That’s also a good way to describe our relationship with government debt. We know it can’t last, but we can’t walk out. We love government spending and its benefits (like Medicare, Social Security, and unemployment insurance) too much.[embedded content].In other words, we are in a debt trap. Our political process can’t reduce spending and/or raise taxes enough to balance the budget, so the

Posted on 17 October 2020
by Constantin Gurdgiev, TrueEconomics.Blogspot.in

Things are getting once again very serious in Europe, of course, which makes this update a bit of change on prior reports, the two most recent here and here.Please share this article – Go to very top of page, right hand side, for social media buttons.So, let’s start with cases and daily deaths:The EU27 are now experiencing a full-blown second wave of infections. As the result, over October 1-16, EU27 new case numbers have surpassed the U.S. on 14 occasions and deaths on 3 occasions.The above development is extremely alarming. As the first chart shows, EU27 is setting new records in total numbers of daily cases, records that are running at a rate of 3 times higher daily new cases counts that at the peak of

Posted on 15 October 2020
by Philip Pilkington

While I do not really want to deal with the Austrians on this blog – let alone Mises who, together with Rothbard, was the most muddled and mediocre of the school – nevertheless I think it might be worthwhile making a general point about Mises’ book Human Action. As discussed previously on this blog Mises’ goal was essentially to form an a priori basis with which to delineate all of human behavior.Please share this article – Go to very top of page, right hand side, for social media buttons.I have already in my last post on the topic outlined why this is a doomed project. Here I would like to raise a more fundamental logical inconsistency in Mises’ project – a logical inconsistency that can be traced back to Kant himself who, of

Posted on 11 October 2020
by John Mauldin, Thoughts from the Frontline

Like everyone else, I am weary of this pandemic mess. I want to travel freely, enjoy dinner with friends, hug, and shake hands.Please share this article – Go to very top of page, right hand side, for social media buttons.And, of course, I want everyone who lost jobs and businesses to get them back. I wasn’t thrilled with the economy a year ago, but I’d take it again in a heartbeat.Alas, that’s not going to happen. The recovery in front of us will be slower than we like. History shows improvement over time. Extreme poverty keeps dropping significantly every decade, although this year was a major setback. But that trend will eventually return. We will get through this. Yet the world on the other side will be

Posted on 10 October 2020
from Voxeu.org

— this post authored by Eric Lonergan and Megan GreeneThe low interest rate environment since the Global Financial Crisis has led economists and analysts to suggest that major central banks have run out of monetary policy tools with which to face major downturns, including the Covid-19 crisis. This column argues that a dual interest rate approach could help to eliminate the effective lower bound and given central banks infinite fire power. By employing dual interest rates, central banks can go beyond targeting short-term interest rates and providing emergency liquidity to provide a stimulus across the economy. As political support for fiscal stimulus in the face of the Covid-19 crisis wanes, central banks can and should step in with

Posted on 08 October 2020
by Constantin Gurdgiev, TrueEconomics.Blogspot.in

Here is the latest data update on pandemic development through 07 October 2020 for the U.S. and EU27. The last report in this series was COVID19 Update: US Vs EU27 12September 2020.Please share this article – Go to very top of page, right hand side, for social media buttons.The EU27 is now experiencing a second wave of infections, while the U.S. new infections rate has moderated off the prior peaks, although moderation is relatively weak and daily cases are highly volatile.As the result, in the last 10 days, EU27 new case numbers have surpassed the U.S. on 4 occasions and deaths on 2 occasions. Over the last 30 days, numbers of new cases in the EU27 exceeded those in the U.S. over 9 days, while numbers of

The August labor report was revised higher from 1.371 million to 1.489 million jobs created, but private sector job creation was revised lower by 5,000 to 1.022 million. That means total government jobs created was revised higher from 344,000 to 467,000. That’s a huge number. Backing that out shows private sector job creation looks fine in September compared to August. We follow the private sector because it tells us where we are in the business cycle. Yes, government spending and taxation impacts the cycle, but government employment largely doesn’t.Please share this article – Go to very top of page, right hand side, for social media buttons.Government job creation played an important role in the September report as well, but this time in the opposite manner. There were 661,000 total jobs

In response to my article last week, a commenter on a private group I’m engaged with said that I must have fallen on the side of Michel Foucault in the famous Foucault-Chomsky debate. This is most certainly true and perhaps this is a good opportunity to lay out some thoughts on that debate.Please share this article – Go to very top of page, right hand side, for social media buttons.Right off the bat I should state that I am not at all interested in the politics of the debate. Both men are revolutionary anarchists of some stripe or other and I have no sympathy for their cause. Instead what I am interested in are the two opposing philosophical viewpoints that are being expounded by the two men buried in the political rhetoric.The first question to ask about the debate is: from what position

Posted on 07 October 2020
by Lance Roberts, Clarity Financial

We have frequently discussed the “one-way trip" of American debt and the long, slow slide into the “Japanification" of America.The amount of outstanding debt, and the subsequent deficit, has long been a problem in the U.S. For the last two decades, policymakers have made annual promises for more substantial economic growth. Yet with each passing year, growth rates weaken, and economic prosperity worsens. As we discussed pre-pandemic in “Economy Should Grow Faster Than Debt:"“The chart below shows the deficit, 10-year average GDP growth, and the annual change in Federal Debt. The problem should be obvious. Since the Federal government began ramping up debt, and running deficits, growth continues to deteriorate. Such is

Posted on 05 October 2020
Written by Econintersect Guest

— this post authored by Lars P. SyllTwenty-seven years ago yours truly wrote an article on revealed preference theory that got published in History of Political Economy (no. 25, 1993).Paul Samuelson wrote a kind letter and informed me that he was the one who had recommended it for publication.Please share this article – Go to very top of page, right hand side, for social media buttons.But although he liked a lot in it, he also wrote a comment – published in the same volume of HOPE – saying:Between 1938 and 1947, and since then as Pålsson Syll points out, I have been scrupulously careful not to claim for revealed preference theory novelties and advantages it does not merit. But Pålsson Syll’s readers must not believe that

Posted on 04 October 2020
by John Mauldin, Thoughts from the Frontline

"There is no means of avoiding the final collapse of a boom brought about by credit expansion." – Ludwig von MisesPlease share this article – Go to very top of page, right hand side, for social media buttons.Economic recovery is coming, we are told, because the economy has found a new equilibrium. We are supposedly adapting to the new-normal pandemic world, with monetary and (some) fiscal stimulus filling any gaps. Except that’s not what the data says.Last week I laid out the case that US government debt would be $50 trillion by 2030. That was using straight-line CBO projections but using the 2008 recovery pattern for government revenue plus adding in off-budget debt which averages about $269 billion a year.

Posted on 03 October 2020
by UPFINA

Weekend Reading from UPFINABefore we get into the details of the jobless claims report, remember that California’s data didn’t update because the state didn’t accept unemployment claims. That will be the same for next week. Technically, you can argue claims will be higher than normal in these 2 reports because the labor market is improving, but California’s data is stuck. It will be interesting to see how much of a backlog forms as a result of not accepting people. There might be an increase in claims in California in the first week the state starts accepting claim applicants again.Please share this article – Go to very top of page, right hand side, for social media buttons.In the week of September 26th, there were 837,000 seasonally adjusted

Posted on 01 October 2020
by Philip Pilkington

Article of the Week from Fixing the EconomistsYou won’t see me dealing with the Austrian School of economics much on this blog. I wrote a long essay on them before and I think it says almost as much as needs to be said; namely, that the Austrians are just neoclassicals who substituted Faith for mathematics in their search for economic truth.Please share this article – Go to very top of page, right hand side, for social media buttons.Insofar as practical differences between the Austrians and the neoclassicals it is simply a matter of ideology and extremity – not to mention a characteristic incoherence and general sense of confusion on the Austrian side. Take their business-cycle theory, for example. It is actually a Wicksellian

Posted on 30 September 2020
by UPFINA

Article of the Week from UPFINAThe economy likely had solid job growth in September, albeit it will be much lower than August. It should have good job creation given the circumstances. Specifically, the leisure and hospitality industry is hamstrung by the COVID-19 restrictions. Airplane travel is still down by about 2/3rds. We need better treatments or a vaccine to show promise along with testing at airports. The travel industry can recover next year if everything goes right.Please share this article – Go to very top of page, right hand side, for social media buttons.The good news is the 7-day average of testing has reached 883,087 which is near its record high. The testing data is headed in the right direction, but more work needs to be

Posted on 26 September 2020
by UPFINA

Weekend Reading from UPFINAWe got a few good data points on the consumer. It’s fairly clear, the weakness in the 2nd week in September was a result of the Labor Day holiday shifting spending. That’s similar to how there was growth in COVID-19 cases and deaths briefly following the holiday because the holiday suppressed data. This is an obvious point some people are missing.Please share this article – Go to very top of page, right hand side, for social media buttons.Redbook same store sales growth in the week of September 19th was up from -1.2% to 1.5%. This is still weak growth, but it ended the downtrend. Furthermore, card spending via Chase was down 5.8% in the week of September 18th which was an improvement from -6.5%. That’s not a

Posted on 26 September 2020
from Voxeu.org

— this post authored by Steve Charnovitz and Gary HufbauerOn 14 July 2020, the U.S. Court of International Trade (USCIT) issued a landmark decision voiding US tariffs on steel from Turkey imposed by President Trump in August 2018.1 Judicial annulments of presidential trade actions are almost unknown.Please share this article – Go to very top of page, right hand side, for social media buttons.What makes the Transpacific Steel ruling especially important is that the USCIT ruled against the president not only on statutory grounds, but also on Constitutional grounds. We are unaware of a similar court decision in US trade law jurisprudence.The steel tariffs at issue were invoked under Section 232 of the Trade Expansion Act of 1962.

Posted on 26 September 2020
by John Mauldin, Thoughts from the Frontline

Amid all 2020’s new problems, it’s easy to overlook the old ones. Yet they are still there and, like a silently spreading virus, silently getting worse.Please share this article – Go to very top of page, right hand side, for social media buttons.One such problem is debt, and specifically government debt. All debt shares one common characteristic. A bill comes due at some point and, if the borrower doesn’t pay, the lender either loses their money or finds someone else to pay. Governments often do this.I’ve warned for several years now that our growing global debt load is unpayable and we will eventually “reorganize" it in what I call The Great Reset. I believe this event is still coming, likely later in this

Posted on 26 September 2020
by Gail Tverberg, Our Finite World

Many people thought that COVID-19 would be gone with a short shutdown. They also thought that the world’s economic problems could be cured with a six month “dose" of stimulus.It is increasingly clear that neither of these assumptions is correct. Please share this article – Go to very top of page, right hand side, for social media buttons.Despite the claims of epidemiologists, our best efforts have never been able to reduce the number of newly reported COVID-19 cases for the world as a whole for any significant period of time. In fact, the latest week seems to be the highest week so far.Figure 1. Chart of worldwide COVID-19 new cases, in chart prepared by Worldometer with data through September 20, 2020.At the same time,

Posted on 24 September 2020
by David Andolfatto

The idea of a central bank digital currency has prompted a mixed reaction among economists. This column uses a simple theoretical framework to investigate the impact of such a currency on a monopolistic banking sector.Please share this article – Go to very top of page, right hand side, for social media buttons.The recent surge of interest in privately issued cryptocurrencies has led a number of economists to investigate the possibility of central bank versions of a digital currency (e.g. Bech and Garratt 2017, Engert and Fung 2017, Kahn et al. 2019). Some, like Bordo and Levin (2017), see a great deal of merit in the proposal. Others, like Cecchetti and Schoenholtz (2017), see less benign consequences. These authors express major

Posted on 24 September 2020

by Philip Pilkington

Article of the Week from Fixing the Economists

I’ve been reading up a lot on economic theories of speculation as this is precisely what my dissertation is on and so far as I can tell the only real attempt to deal with speculative dynamics from a properly macroeconomic point-of-view is Nicholas Kaldor’s 1939 paper Speculation and Economic Stability. Sure, people will point to Minsky’s theories but they do not really contain a theory of speculation. The closest is really Keynes’ own A Treatise on Money but the discussion there is rather primitive. In what follows I will lay out a critical overview of Kaldor’s paper.

Please share this article – Go to very top of page, right hand side, for social media buttons.

Kaldor sees the

Posted on 20 September 2020

by John Mauldin, Thoughts from the Frontline

When Cornwallis surrendered to George Washington at Yorktown in 1781, tradition has it that the British band played an old English children’s folk tune, "The World Turned Upside Down."

Please share this article – Go to very top of page, right hand side, for social media buttons.

If buttercups buzz’d after the bee,

If boats were on land, churches on sea,

If ponies rode men and if grass ate the cows,

And cats should be chased into holes by the mouse,

If the mamas sold their babies

To the gypsies for half a crown;

If summer were spring and the other way ’round,

Then all the world would be upside down.

Painting by John Trumbull

In this article I find myself recommending policies

Posted on 17 September 2020
Written by Econintersect Guest

— this post authored by Alexander C. Furnas and Timothy M. LaPira, NewAmerica.orgCongressional staff compensation has generally declined in recent decades, but these patterns are not uniform across all positions and employing offices. The cause of the decline is complicated. During this time period, information technology innovations have made constituent and media communication cheaper, but also more demanding.2 Please share this article – Go to very top of page, right hand side, for social media buttons.The declining cost of constituent communication and the rapid pace of public relations, in both traditional media and the break-neck rise of social media, have made members of Congress shift their attention away from

Posted on 17 September 2020
by Philip Pilkington

How Far Can We Push This Thing?Article of the Week from Fixing the EconomistsReaders are probably aware that there is quite a lot of discussion of Modern Monetary Theory (MMT) and the potential for fiscal experimentation batting around at the moment. Others have weighed in on this already, and I have little to add.Please share this article – Go to very top of page, right hand side, for social media buttons.It is striking, however, that most of the push-back – where there is push-back – is not focused on trying to discredit the idea that we should engage in fiscal experimentation. Indeed, the notion that we should engage in fiscal experimentation seems to be, if not mainstream, at the very least part of the discussion.Yet, vulgar

Posted on 17 September 2020

by Constantin Gurdgiev, TrueEconomics.Blogspot.in

I have not updated the controversial comparatives between the Nordics (ex-Sweden) and Sweden in terms of COVID19 pandemic figures for some time now.

Please share this article – Go to very top of page, right hand side, for social media buttons.

For those of you who are out of the loop in this controversy:

Sweden imposed weak restrictions (basically none) on mobility and work environments in the wake of the pandemic, pursuing the strategy of ‘herd immunity’;
Other Nordics imposed severe crack downs on mobility and social and work environments in response to COVID19 pandemic.
There has been a lot of controversy as to the effectiveness or the lack thereof of the Swedish strategy.

So here are the

Posted on 16 September 2020
by UPFINA

Article of the Week from UPFINAThe jobless claims report from the week of September 5th was a mixed bag. There are a few twists with this data update which must be noted or you’ll be misled by the headlines. Seasonally adjusted claims stayed the same at 884,000. This is the 2nd week with the new adjustment. The only thing we can see so far is the seasonal adjustment put claims closer to non-seasonally adjusted claims.Please share this article – Go to very top of page, right hand side, for social media buttons.It’s unfortunate that the seasonality component changed right in the middle of the biggest cyclical shift in this report’s history. We’ve been looking at the NSA number anyway though.As the chart below shows, NSA initial claims rose from