Porsche's helpful video on brake squeals
Wednesday, January 31, 2018
Janet Yellen’s Legacy
It's Too Early to Assess Yellen's Legacy
Related:
Future Direction of US Monetary Policy
Price level targeting versus Inflation targeting
https://www.bloomberg.com/view/articles/2018-01-31/when-the-fed-talks-price-level-targets-markets-should-shudderTuesday, January 30, 2018
Eurozone is Back
Eurozone economy enjoys its best year in a
decade
Europe’s Economic Growth, aided by France,
Outpaces U.S.
https://www.wsj.com/articles/french-economy-accelerates-at-fastest-pace-in-six-years-1517303003US Economy - Interesting Developments
Can Amazon Fix US Healthcare?
US Manufacturing
Revival – Realistic Appraisal
Bloomberg’s Noah Smith notes
“…even if U.S.
manufacturing regains its dominance, most of the jobs aren’t coming back. Like
agriculture a century ago, manufacturing is doing more with less --
productivity continues to increase, even as demand for manufactured goods
remains relatively constant.”
Sunday, January 28, 2018
Is the World Bank Still Relevant?
The World Bank Is Remaking Itself as a Creature
of Wall Street
https://www.nytimes.com/2018/01/25/business/world-bank-jim-yong-kim.htmlTechnological Progress Through the Ages [MUST READ]
The Case Against Civilization: Did our
hunter-gatherer ancestors have it better? By John Lanchester
“We don’t give the
technology of fire enough credit, Scott suggests, because we don’t give our
ancestors much credit for their ingenuity over the long period—ninety-five per
cent of human history—during which most of our species were hunter-gatherers. …
To demonstrate the significance of fire, he points to what we’ve found in
certain caves in southern Africa. The earliest, oldest strata of the caves
contain whole skeletons of carnivores and many chewed-up bone fragments of the
things they were eating, including us. Then comes the layer from when we
discovered fire, and ownership of the caves switches: the human skeletons are
whole, and the carnivores are bone fragments. Fire is the difference between
eating lunch and being lunch.
Anatomically modern
humans have been around for roughly two hundred thousand years. For most of
that time, we lived as hunter-gatherers. Then, about twelve thousand years ago,
came what is generally agreed to be the definitive before-and-after moment in
our ascent to planetary dominance: the Neolithic Revolution. This was our
adoption of, to use Scott’s word, a “package” of agricultural innovations,
notably the domestication of animals such as the cow and the pig, and the
transition from hunting and gathering to planting and cultivating crops. The
most important of these crops have been the cereals—wheat, barley, rice, and
maize—that remain the staples of humanity’s diet. Cereals allowed population
growth and the birth of cities, and, hence, the development of states and the
rise of complex societies.BOOK RECOMMENDATION
Insufficient Policy Tools to Fight the Next Recession
Well-known Republican economist Martin
Feldstein on The Heightened Risks of a US Downturn
https://www.project-syndicate.org/commentary/us-recession-inadequate-stimulus-tools-by-martin-feldstein-2018-01Saturday, January 27, 2018
Trade Protectionism - Historical Perspective
When protectionism is not about protecting
America at all
George Will’s notes:
“Fomenting spurious
anxieties about national security is the first refuge of rent-seeking
scoundrels who tart up their protectionism as patriotism when they inveigle
government into lining their pockets with money extracted from their fellow
citizens. Sugar producers are ludicrously protected in the name of “food
security.””
Lessons from the 1980s
Inefficiencies Created by Local-Content Rules
How to Lose a Trade
War by Stephen Roach
https://www.project-syndicate.org/commentary/trump-solar-panel-tariffs-by-stephen-s--roach-2018-01Hedge Funds and Political Corruption
An astonishing report from Bloomberg BusinessWeek:
How Hedge Funds (Secretly) Get Their Way in
Washington
https://www.bloomberg.com/news/features/2018-01-25/how-hedge-funds-secretly-get-their-way-in-washingtonA Synchronized Uptick in the Global Economy
Synchronized Global
Economic Recovery
Peter Goodman notes:
“In general terms,
improvement owes less to some newfound wellspring of wealth than the simple
fact that many of the destructive forces that felled growth have finally
exhausted their potency.”
Obstfeld notes:
“The primary sources of GDP acceleration so far have been in Europe and Asia, with improved performance also in the United States, Canada, and some large emerging markets, notably Brazil and Russia, both of which shrank in 2016, and Turkey. Much of this momentum will carry through into the near term. The recent U.S. tax legislation will contribute noticeably to U.S. growth over the next few years, largely because of the temporary exceptional investment incentives that it offers. This short-term growth boost will have positive, albeit short-lived, output spillovers for U.S. trade partners, but will also likely widen the U.S. current account deficit, strengthen the dollar, and affect international investment flows.”
IMF Chief economist Maurice Obstfeld on the near-term
outlook for the global economy:
https://blogs.imf.org/2018/01/22/the-current-economic-sweet-spot-is-not-the-new-normal/Obstfeld notes:
“The primary sources of GDP acceleration so far have been in Europe and Asia, with improved performance also in the United States, Canada, and some large emerging markets, notably Brazil and Russia, both of which shrank in 2016, and Turkey. Much of this momentum will carry through into the near term. The recent U.S. tax legislation will contribute noticeably to U.S. growth over the next few years, largely because of the temporary exceptional investment incentives that it offers. This short-term growth boost will have positive, albeit short-lived, output spillovers for U.S. trade partners, but will also likely widen the U.S. current account deficit, strengthen the dollar, and affect international investment flows.”
Justin Fox - It's Still a Slow-Growth U.S.
Economy
Fox notes:
“Short-term boosts to economic growth can also be
driven by governments, households or businesses spending borrowed money. But
that doesn't always end well. It certainly didn't after the mid-2000s housing
bubble. In fact, given the slow growth of the working-age population, it might
be wiser just to accept that 2.5 percent annual GDP growth eight years into a
recovery isn't such a terrible thing.”
Friday, January 26, 2018
Consumer Confidence and Business Cycles
Nobel Prize winning Yale economist Robert Shiller examines
the role of consumer confidence:
Business Consolidation and Slow Wage Growth
Interesting read: Why Is Pay Lagging? Maybe Too Many Mergers
in the Heartland
https://www.nytimes.com/2018/01/25/business/economy/mergers-worker-pay.html
New Study Shows Just How Bad the US Labor
Market’s Competition Problem Really Is
https://promarket.org/new-study-shows-just-bad-us-labor-markets-competition-problem-really/Thursday, January 25, 2018
Amazon's Second HQ Shortlist
The drama surrounding Amazon’s search for a second
headquarters continues:
https://www.washingtonpost.com/news/the-switch/wp/2018/01/18/this-is-amazons-official-shortlist-of-places-its-considering-for-a-second-hq/
Update:
Promising Billions to Amazon: Is It a Good
Deal for Cities?
https://www.nytimes.com/2018/01/26/business/economy/amazon-finalists-incentives.htmlECB and BOJ Policy Challenges
Why Strong Growth Is a Headache for the European
Central Bank
The Bank of Japan’s Moment of Truth
US Economy - Interesting Items
America = Oil Superpower?
https://www.bloomberg.com/news/articles/2018-01-25/the-dark-side-of-america-s-rise-to-oil-superpower
The U.S. Can No Longer
Hide From Its Deep Poverty Problem by Angus Deaton
Wednesday, January 24, 2018
Can the Planet Sustain Ten Billion People?
Charles Mann’s fascinating piece is worth reading:
Mann notes:
“In 1970, when I
was in high school, about one out of every four people was
hungry—“undernourished,” to use the term preferred today by the United Nations.
Today the proportion has fallen to roughly one out of 10. In those four-plus
decades, the global average life span has, astoundingly, risen by more than 11
years; most of the increase occurred in poor places. Hundreds of millions of
people in Asia, Latin America, and Africa have lifted themselves from
destitution into something like the middle class. This enrichment has not
occurred evenly or equitably: Millions upon millions are not prosperous. Still,
nothing like this surge of well-being has ever happened before. No one knows
whether the rise can continue, or whether our current affluence can be sustained.”
Tuesday, January 23, 2018
Water Crisis in the 21st Century
Cape Town offers a cautionary tale
https://www.bloomberg.com/view/articles/2018-01-23/the-city-that-ran-out-of-waterMonday, January 22, 2018
Global Economy - Update
Does Germany need to boost domestic investment?
Oil price rebound – demand or supply driven?
Argentina’s Economic Recovery
Sunday, January 21, 2018
Dubai’s Cultural Identity in the 21st Century
Interesting read: Nomadic utopia: will Dubai’s many worlds
ever find a common cultural identity?
https://www.newstatesman.com/world/middle-east/2018/01/nomadic-utopia-will-dubai-s-many-worlds-ever-find-common-cultural-identityRelated:
NYTIMES on Qatar
US-China Trade Ties
Important and timely new research: Reconsidering the ‘China shock’ in trade by Robert Feenstra, Hong Ma, Akira Sasahara, and Yuan Xu
A trade war with China would backfire on Trump — and America
Zachary Karabell notes:
“China’s hints about curtailing bond purchases were a quiet but unsubtle reminder from Beijing that it is economically armed — and dangerous — if need be. Over the next decade, China will diversify its economic relationships even more and become that much less dependent on the United States as a market. Accepting, acknowledging and acting as though the U.S.-China relationship were approaching one of economic equals would be the foundation of wise policy; proceeding as though we’re still an unrivaled hegemon will not restore American dominance, but it will hasten America’s relative decline.”
Property Rights and Zimbabwe’s Future
Establishing clear land rights is key to Zimbabwe’s economic future
https://www.nytimes.com/2018/01/20/world/africa/zimbabwe-land-disputes-mugabe-mnangagwa.htmlUS Immigration Debate – Historical Perspective
An excellent piece from conservative columnist George
Will
George Will notes:
“After the Sept. 11
attacks, attitudes about immigration became entangled with policies about
terrorism. So, as the Economist noted, “a mass murder committed by mostly Saudi
terrorists resulted in an almost limitless amount of money being made available
for the deportation of Mexican house-painters.” This month, U.S. Immigration
and Customs Enforcement agents raided 98 7-Eleven stores in 17 states, making
21 arrests, approximately one for every 4.5 stores. Rome was not built in a day
and it would be unreasonable to expect the government to guarantee, in one fell
swoop, that only American citizens will hold jobs dispensing Slurpees and Big
Gulps.”
The Ghost of
Chae Chan Ping
Related:
There’s a middle ground on immigration. Both
sides refuse to find it.
https://www.washingtonpost.com/opinions/global-opinions/theres-a-middle-ground-on-immigration-both-sides-refuse-to-find-it/2018/01/18/cf043028-fc93-11e7-ad8c-ecbb62019393_story.htmlPolitics versus Economics – Evaluating Recent US Corporate Behavior
Economics may not be driving corporate
generosity
https://www.washingtonpost.com/business/economy/economics-may-not-be-driving-corporate-generosity/2018/01/19/a3995d62-f6eb-11e7-91af-31ac729add94_story.html
Apple’s Media Relations Coup – Waving the Flag Makes Business
Sense
https://slate.com/business/2018/01/no-apple-is-not-creating-20-000-jobs-because-of-the-tax-bill.html
Slate’s Weismann notes:
“The press release predicts that between its “current pace of
spending with domestic suppliers and manufacturers—an estimated $55 billion for
2018—Apple’s direct contribution to the US economy will be more than $350
billion over the next five years.” In other words, Apple will keep buying stuff
from other U.S. companies. This is not a patriotic act of charity. Apple is
literally saying it will continue business as usual. That alone accounts for
$275 billion of its $350 billion forecast.
As for the rest of that total? In a mystifying bit of
self-aggrandizement, the company is counting its $38 billion repatriation
payment as another “direct contribution” to the U.S. economy. This is money
they are required to pay by law. “A payment of that size would likely be the
largest of its kind ever made,” the company helpfully notes. This is only true
because Apple spent years making money hand-over-fist while doing everything in
its power to avoid taxes.”
Related:
https://www.washingtonpost.com/news/powerpost/paloma/the-finance-202/2018/01/18/the-finance-202-trump-is-eager-to-claim-credit-for-apple-moves-but-it-s-a-bit-more-complicated/5a5fa11d30fb0469e88401c2/International Affairs – Weekend Readings
Roger Cohen on the Middle East
The Mess in Afghanistan/Pakistan
https://www.project-syndicate.org/commentary/united-state-pakistan-relations-aid-cutoff-by-richard-n--haass-2018-01Saturday, January 20, 2018
Interesting Developments in the Automobile Sector
Rise of the SUVs and the Demise of the American Sedan
Japan’s floating cars – might be useful in Florida
US-China Trade in Automobiles and Auto Parts
Electric Vehicles Market – Why China will Dominate EV
Sales
http://money.cnn.com/2017/11/20/investing/lithium-china-electric-car-batteries/index.htmlThursday, January 18, 2018
Wednesday, January 17, 2018
History Lesson: Global Trade in the Pre-Modern Era
8 Trade Routes That Shaped World History
Importance of Spice Trade in World History
[HIGHLY RECOMMENDED]
The Indian Ocean: A Maritime Trade Network
History Nearly Forgot
Roman trade with India
https://www.bundesbank.de/Redaktion/EN/Downloads/Bundesbank/Money_Museum/global_players.pdf
https://www.bundesbank.de/Redaktion/EN/Downloads/Bundesbank/Money_Museum/global_players.pdf
Silk Road and the East-West Trade
--
For globalization trends since 1820, see:
The Great Convergence: Information
Technology and the New Globalization by Richard Baldwin
Looking Past the Bitcoin Bubble
Has the Bitcoin Bubble Finally Burst?
Related:
A fascinating read: Beyond the Bitcoin Bubble
Steven Johnson notes:
“The true believers behind blockchain platforms like Ethereum
argue that a network of distributed trust is one of those advances in software
architecture that will prove, in the long run, to have historic significance.
That promise has helped fuel the huge jump in cryptocurrency valuations. But in
a way, the Bitcoin bubble may ultimately turn out to be a distraction from the
true significance of the blockchain. The real promise of these new
technologies, many of their evangelists believe, lies not in displacing our
currencies but in replacing much of what we now think of as the internet, while
at the same time returning the online world to a more decentralized and
egalitarian system. If you believe the evangelists, the blockchain is the
future. But it is also a way of getting back to the internet’s roots.”
Quality of Life Indicators – Crime and Safety
Singapore’s crime rate is so low that many shops don’t even
lock up
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