Asymptosis: Always Approaching

Month: July 2011

  • Yeah Right: Supply of Credit to Businesses Is a Big Problem

    Click for source. Demand for credit continues to decline, while corporate (especially financial) cash balances are at an all-time high. What are supply-siders smoking? See here and the links therein for much more evidence of the same. Related posts: Don’t Like “Money Printing”? Then Stop Borrowing. Whip Inflation Now! Did I Mention Mentioning that It’s…

  • Does Reducing the Federal Debt Cause Financial Collapse?

    Of all the reading in Modern Monetary Theory that I’ve been doing of late, perhaps the most eyebrow-raising paragraphs I’ve come across are these, from the redoubtable Randall Wray: With one brief exception, the federal government has been in debt every year since 1776. In January 1835, for the first and only time in U.S.…

  • Where’s the Demand?

    Very interesting thinking from The Economist‘s Democracy in America (whoever that is) on the (apparent) lack of demand in our current economy: …people … may not be interested in buying a new car this year, but … they’re very interested in riding the subway … There is demand out there. It just isn’t for individual consumer goods. This…

  • This Isn’t Really Complicated, Is It?

    Obama went after the elephant in the room, at huge political cost. Say what you will about his political savvy, the way he went about it, or the reform’s likely (as opposed to hoped-for) effects, but it makes pretty clear who’s the adult in the room. Related posts: It’s The Health Care Costs, Stupid David…

  • More American Exceptionalism: Government Revenues

    Let’s adopt the unpresuming assumptions that: 1. A prosperous, modern economy needs a certain amount of government (taxing, spending) to become and remain prosperous. And that government has to be paid for via taxes and other government revenues. Simple enough. 2. Either too much or too little government in a country results in a poor…

  • 520 Traffic is Declining — Despite 15 Years of WSDOT Projections to the Contrary

    For my Seattle friends (click for source): As my buddy Steve says, just float in a new span before the current one sinks, and call it good. Related posts: Bush Promotes Private Sector: Cancels Shuttle for Football Fans Seattle’s a Happy Place! Outstate Washington, Appalachia: Not So Much Can John Gottman Predict Divorce? (Probably Not.)…

  • Death and Money: American Exceptionalism

    Lane Kenworthy once again gives us one of those graphs that encapsulates a whole global scenario, over four decades: Yeah: we’re #1. Edit: just to note that while we were on the high end of the spending pack until about 1980, we were within the normal range. It’s only since then that things really went…

  • Debt > 90% of GDP “associated with 1 percent lower median growth”

    Reinhard and Rogoff again repeat this claim. 1. As I pointed out, out of 3,700 samples (country/years) they find five (I found six) years of U.S. debt at that level: 1944-1949. Which was followed, of course, by the best two decades of U. S. growth in living memory. 2. Krugman went deeper:   as best…

  • Neoclassical economists don’t understand neoclassical economics

    I don’t usually just give the link and leave it at that. But I can’t hope to encapsulate the video here — essential viewing for everyone with any interest in economics, even if you have read Chapter Two of Keen’s book. (If you haven’t, watch the video now and wait till September to buy the…

  • Rents versus Profits

    Mike Konczal makes a key distinction that importantly frames recent discussions about “rentiers.” In my words: Rent is money received for having money. Profit is money earned for using money (your own and others’) to generate and sell real production — goods and services that have human value. As I’ve suggested in previous posts, American…

  • “The most productive members of our society.”

    “How do you know they’re the most productive members of our society?” “Because they make the most money.” “Ah. That explains why they make so much money.” Related posts: Nature: Good? 1098: If Millionaires Vote With Their Feet, They Apparently Don’t Care About Income Taxes Tea Partiers and OWSers: Who Needs to Get a Job?…

  • What Would Ronald Reagan Do?

    The budget deals of Reagan, Bush, Clinton and Obama, in one chart – Ezra Klein – The Washington Post. Related posts: 11 Percent of the Population Can Veto Anything Mea Culpa: Rivlin-Domenici Needs Work This Time Mankiw’s Just Plain Lying. And He Knows It. Gaming McCain’s Game Why Did Edwards Quit?

  • How Could You Possibly Call Them Hypocrites?

    June 2002: Congress approves a $450 billion increase, raising the debt limit to $6.4 trillion. McConnell, Boehner, and Cantor vote “yea”, Kyl votes “nay.” May 2003: Congress approves a $900 billion increase, raising the debt limit to $7.384 trillion. All four approve. November 2004: Congress approves an $800 billion increase, raising the debt limit to…

  • IS-LM: “A classroom gadget” (Wonkish)

    I’ve long felt inadequate when reading Very Serious People discussing economics, especially monetary economics (really: what other kind is there?), when they drop into discussions of the IS-LM model — standard fare that is proposed as gospel in economics textbooks and is widely used by Very Serious Economists making Very Serious Points. I feel inadequate…

  • Should the Government Just Keep Spending?

    Greg Mankiw, Dean Baker, and Tyler Cowen all light upon the surprising suggestion by Ron Paul: simply evaporate all the government bonds ($1.6 trillion worth) that the Fed has bought up of late. They’re just debts of one part of government to another part of government, so why not simply vanish them, reducing the treasury’s outstanding…