Ellis Winningham — Balanced Budget Amendment Idiocy – An Economic Suicide Pact

The Balanced Budget Amendment Task Force, better known as “Task Force Stupid”, is once again living up to their name. The tile of their thoroughly idiotic petition that you can ignore here says: “Email the Idaho Legislature in Support of a U.S. Balanced Budget Amendment! Destroy the U.S. Economy!” What follows is the technical reason why the Balanced Budget Amendment Task Force is run by complete morons.

Ellis Winningham — MMT and Modern Macroeconomics
Balanced Budget Amendment Idiocy – An Economic Suicide PactEllis Winningham

Joseph Thomas — US Concerns Over “Election Interference” May Backfire

... the US’ reaction to what it claims is “2016 election interference” could significantly backfire, since the US itself is engaged in very real, overt election interference globally, and for decades. In fact, even as the US berated Russia for allegedly interfering in America’s internal politics, its own organisations, including the National Endowment for Democracy (NED), funded by the US government, openly admitted they were leaking information regarding China’s internal politics in efforts to undermine Beijing.

In fact, NED and its subsidiaries (including the National Democratic Institute (NDI), the International Republican Institute (IRI) and Freedom House) as well as myriad fronts around the world these organisations fund, support and direct, are openly dedicated to manipulating foreign elections, creating US-friendly opposition movements and even overthrowing governments that impede US interests worldwide.…

... nations like China, Malaysia and Thailand have verified evidence that opposition fronts are funded, backed and even directed by US organisations like NED. What has been perhaps preventing these nations from dismantling these foreign-backed networks, has been the illusion of America’s pro-democracy stance. However, with the US now cracking down on whistle-blowers, opposition media and shifting tides amid American politics all based on allegations of “Russian” involvement, what is preventing other states from cracking down on verified US interference in their own internal politics?

Russia and China were already kicking out the US NGOs and shuttering domestic NGOs receiving foreign funding for this reason. Of course, the US protested this vigorously as an illiberal outrage.

One of the paradoxes of liberalism is that liberal countries can force liberalism on other countries even through regime change and even military means, but other countries cannot attempt to influence liberal countries. Because "freedom and democracy."

NEO

US Concerns Over “Election Interference” May Backfire

Joseph Thomas | chief editor of Thailand-based geopolitical journal, The New Atlas and contributor to the online magazine “New Eastern Outlook”

See also

McCain and Graham, the leaders of the US War Party at work fomenting more war.

Happy New Year Donbass: From Killer John McCain & Co.

George Ellison — Why Crowdstrike's Russian Hacking Story Fell Apart--Say Hello to Fancy Bear

In the wake of the JAR-16-20296 dated December 29, 2016, about hacking and influencing the 2016 election, the need for real evidence is clear. The joint report adds nothing substantial to the October 7th report. It relies on proofs provided by the cyber-security firm Crowdstrike that is clearly not on par with intelligence findings or evidence. At the top of the report is an "as is" statement showing this.

The difference between [Co-Founder and CTO of CrowdStrike Inc.] Dmitri Alperovitch's claims, which are reflected in JAR-1620296, and this article is that enough evidence is provided to warrant an investigation of specific parties for the DNC hacks. The real story involves specific anti-American actors that need to be investigated for real crimes.

Later in this article, you'll meet and know a little more about the real "Fancy Bear and Cozy Bear." The bar for identification set by has never been able to get beyond words like probably, may be, could be, or should be in their attribution.

The article is lengthy because the facts need to be in one place. The bar Dimitri Alperovitch set for identifying the hackers involved is that low. Other than asking America to trust them, how many solid facts has Alperovitch provided to back his claim of Russian involvement?

The December 29th JAR adds a flowchart that shows how a basic phishing hack is performed. It doesn't add anything substantial beyond that. Noticeably, they use both their designation APT 28 and APT 29 as well as the CrowdStrike labels of Fancy Bear and Cozy Bear separately.

This is important because information from outside intelligence agencies has the value of rumor or unsubstantiated information at best according to policy. Usable intelligence needs to be free from partisan politics and verifiable. Intel agencies noted back in the early '90s that every private actor in the information game was radically political....

Reads like a detective story. Longish but gripping. It's an argument that there was likely a criminal conspiracy involved, but not by either the Trump faction or "the Russians."

If you are following this, it is a must-read. Lots of new information and documentation.

OpEdNews
Why Crowdstrike's Russian Hacking Story Fell Apart--Say Hello to Fancy Bear
George Ellison
Crossposted at Washington's Blog

George Ellison lives in Ukraine.

Jean Pisani-Ferry — The Abandonment of Progress

Elites are starting to wake up and are realizing there is a pressing problem they had better get busy solving if they want to stay in power. At least some of them are.

I would not call it the abandonment of progress as much as the stalling of progress and that is the problem. If the progress were distributed there would not be these issues.

There seems to be a prevalence of linear thinking and a dearth of dialectical thinking.

Project Syndicate
The Abandonment of Progress

Jean Pisani-Ferry | Professor at the Hertie School of Governance (Berlin) and Sciences Po (Paris), currently serving as Commissioner-General of France Stratégie, a public policy advisory institution

Timothy Taylor — Engels Rebuts Malthus

Instructive for those unfamiliar Engels. He has the reputation as Marx's sidekick, financial benefactor, and sort of assistant in collaboration, definitely playing a secondary and subordinate role. But reading the Marx-Engels correspondence dispels that simplistic notion. While is true that Engels depends on Marx for his fame, he was a high-level thinker in his own right.

This also dispels the false rumor that Marx and Engels did not appreciate the contribution of science, technology and innovation to economics.

Tim Tayor does mention that Engels presumes that there is no necessity of monetary incentive based on competition for profit to bring forth investment and fund technological development.

It made me smile a bit to contemplate Engels offering a defense of rising output driven by technological progress (and apparently no need for market-based incentives to raise output) as a central part of his challenge to Malthus.

I have always wondered why economists believe that this assumption about the need for money incentive is self-evident, so that creative people need to bribed to create. This belies the evidence of "the starving artist" and "the mad inventor." Creative people create and many if not most want to share this bounty with others without great concern for monetary recompense beyond needs and basic wants. At the opposite end of the spectrum, many of the super-rich also continue to "work" until they are no longer able to do so. Does Warren Buffet need the money or even have any use for more of it?

Conversable Economist
Engels Rebuts Malthus
Timothy Taylor | Managing editor of the Journal of Economic Perspectives, based at Macalester College in St. Paul, Minnesota

Alt-Right Bearish

Spencer looking for a crash via stochastics:

The problem with excitement over a "Trump boom" is that we haven't had a stock-market crash since 2008.

These things come in cycles.

— Richard 🐸 Spencer (@RichardBSpencer) January 3, 2017

Pam and Russ Martens — U.S. Quietly Drops Bombshell: Wall Street Banks Have $2 Trillion European Exposure

Wall Street On Parade
U.S. Quietly Drops Bombshell: Wall Street Banks Have $2 Trillion European Exposure

Pam Martens and Russ Martens

Rhiannon Bury — Ford cancels plans for Mexican plant as Trump blasts General Motors

Global car giant Ford has cancelled plans to build a new $1.6bn plant in Mexico and will instead invest $700m in a Michigan manufacturing base, just hours after president elect Donald Trump blasted rival General Motors for building some of its cars south of the border.

Mr Trump had used Ford as a whipping boy during his presidential campaign, suggesting that it was moving manufacturing jobs to Mexico which should have been for US workers and vowed to slap a 35pc tariff on Ford vehicles made in Mexico but sold in the US....

The Telegraph
Ford cancels plans for Mexican plant as Trump blasts General Motors

Rhiannon Bury

Getting them young.

Before introducing them to Ayn Rand as teens.

Marginal Revolution
Books on liberty-oriented economics for young people

Tyler Cowen | Holbert C. Harris Chair of Economics at George Mason University and serves as chairman and general director of the Mercatus Center

Jack Peat — The New Silk Route: Freight train from China to Barking launched

A new freight rail route connecting Yiwu West Railway Station in Zhejiang Province with Barking in London has been launched by China Railway.

The route, which has been dubbed the New Silk Route by the Chinese government, will take around 18 days to travel over 7,400 miles carrying a cargo of clothes, bags and other household items.

China Railway already runs services between China and other European cities, including Madrid and Hamburg. The rail line has the advantage of being cheaper than air freight and faster than sea....

Here she comes!

The London Economic
The New Silk Route: Freight train from China to Barking launched

Jack Peat, business and economics journalist and the founder of The London Economic

Norman Solomon — Danger in Democrats Demonizing Putin

With the Clintons’ corporate money machine floundering after a devastating election defeat, Democrats are desperate to find someone to blame and have dangerously settled on Vladimir Putin, writes Norman Solomon.

The Democrats have become unhinged over Trump and Putin and are looking like crazy people that are suffering from a severe case of paranoia along with rage and depression. The US "liberal media" is caught up in this mass hysteria. People like that bent on doing stupid stuff and not fit to govern.

Politically it is a suicidal strategy because by making Trump out to to Putler's stooge, they have lowered the bar almost to the ground. When Trump does anything that looks fairway smart, let alone scores a success, the Dems will look like Chicken Little screaming that the sky is falling. Dumb, dumb and dumber.

Oh, and it is also illiberal.

Unfortunately, Norman Solomon reveals himself as also a victim of this obsession, in feeling obliged to demonize Putin, too. His is just a milder case of this mass liberal OCD.

Consortium News
Danger in Democrats Demonizing Putin
Norman Solomon, co-founder of the online activist group RootsAction.org

Dirk Ehnts — Data source for US sectoral balances (links to data and updated graph)

FRED.

It looks like the private sector is starting to save more and/or invest less. The government deficit has stabilized, and so has the current account deficit. Given that the dollar is expensive and global growth weak, demand from the rest of the world will be relatively weak. In order to grow, demand must come from domestic sources then. The private sector, as I just wrote, does not seem to go on a spending binge (and into debt) right now, so it seems like expansionary fiscal policy is the way forward. Let’s see what 2017 brings.

econoblog 101
Data source for US sectoral balances (links to data and updated graph)
Dirk Ehnts | Lecturer at Bard College Berlin

Tim Harford — The iPhone at 10: How the smartphone became so smart

All of these technologies are important components of what makes an iPhone, or any smartphone, actually work. Some of them are not just important, but indispensable. But when Mariana Mazzucato assembled this list of technologies, and reviewed their history, she found something striking.

The foundational figure in the development of the iPhone wasn't Steve Jobs. It was Uncle Sam. Every single one of these 12 key technologies was supported in significant ways by governments - often the American government.

"Who invented the iPhone?" The government. Apple picked up the technology and adapted it to the iPhone. A lot of that technology was likely developed either for military use or military/intelligence-related use.

BBC
The iPhone at 10: How the smartphone became so smart
Tim Harford

Brian Romanchuk — Primer: Inflation Versus Rising Prices

One source of complexity in economic discussion is the ambiguity of the term "inflation." The usual definition is that this is the rate of growth of a price index of consumer goods (such as the CPI). However, economists quite often distinguish sustained rises in the price index versus one-time shocks. Unfortunately, it is difficult to determine whether a rise in prices is going to be sustained. For this reason, it is useful to avoid discussing generic inflation, and use more precise terminology....

"Inflation" is one of those weasel words.

Bond Economics
Primer: Inflation Versus Rising Prices
Brian Romanchuk

Bill Mitchell — Mainstream macroeconomics in a state of ‘intellectual regress’

At the heart of economic policy making, particularly central bank forecasting are so-called Dynamic Stochastic General Equilibrium (DSGE) models of the economy, which are a blight on the world and are the most evolved form of the nonsense that economics students are exposed to in their undergraduate studies. Paul Romer recently published an article on his blog (September 14, 2016) – The Trouble With Macroeconomics – which received a fair amount of attention in the media, given that it represented a rather scathing, and at times, personalised (he ‘names names’) attack on the mainstream of my profession. Paul Romer describes mainstream macroeconomics as being in a state of “intellectual regress” for “three decades” culminating in the latest fad of New Keynesian models where the DSGE framework present a chimera of authority. His attack on mainstream macroeconomics is worth considering and linking with other evidence that the dominant approach in macroeconomics is essentially a fraud.…

Bill Mitchell – billy blog
Mainstream macroeconomics in a state of ‘intellectual regress’
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Fed Behind the Curve?

Not an endorsement of Monetarism; rather how THEY will perhaps view these two reports.

GREAT AGAIN: US construction spending hits more than 10 year high #Trump #TruePundithttps://t.co/3fRZv05AeG

— True Pundit (@true_pundit) January 3, 2017

Manufacturing in U.S. expands at fastest pace in two years https://t.co/FcjAntaMgj @markets

— Modern Metals (@ModernMetalsMag) January 3, 2017

John Reed Stark — Why Donald Trump Is Spot-On About The Russians And The Election

Problems with the narrative that Russia hacked the DNC and Podesta email account and gave the information to Wikileaks.

So far it is all inference and conjecture and zero evidence.

Zero Hedge
Why Donald Trump Is Spot-On About The Russians And The Election
Submitted by John Reed Stark via LinkedIn.com

In an exclusive interview with FOX News Channel's Sean Hannity the founder of WikiLeaks Julian Assange said Russia was not the source for the DNC and John Podesta hacks.…
Hannity's full interview with Assange will air Tuesday night at 10pm ET

Real Clear Politics

Assange To Hannity: Source For WikiLeaks Was Not Russian Government

Ian Schwartz

Related?

UPI
Trump says he'll reveal hacking revelation 'on Tuesday or Wednesday'

Brooks Hayes

Zero Hedge — Yuan Dumps, Bitcoin Jumps As China Researchers Suggest "One-Off Devaluation" & Capital ControlsYuan Dumps, Bitcoin Jumps As China Researchers Suggest "One-Off Devaluation" & Capital Controls

Float that sucker. What are you waiting for?

Bite the bullet like Russia did and it was not the end of the world for them. The ruble stabilized relatively quickly and the Chinese economy is way larger than Russia's and not a victim of Dutch disease either.

China is very protective of national sovereignty. Currency sovereignty is a key piece in that.

Zero Hedge
Yuan Dumps, Bitcoin Jumps As China Researchers Suggest "One-Off Devaluation" & Capital Controls
Tyler Durden

Update

Chinese Interbank Lending Freezes; Government Bond Trading Halted After Massive PBOC Liquidity Drain

Child prodigies

Old news but interesting. Indeed, awesome.

Twelve-year-old Nicole Barr, who lives in Essex in the UK, has scored 162 on an IQ test - beating renowned geniuses Albert Einstein and Stephen Hawking by two points.

Science Alert

This 12-year-old has a higher IQ than Einstein and Stephen Hawking

Fiona Macdonald

Also

Another one a month later. Lydia Sebastian, who is also from Essex. Something in the water?

12-year-old girl scores 162 in the Mensa IQ test

Another British girl, Alma Deutscher, from Surrey, rocks out with a full-length opera.

The Guardian

11-year-old British composer debuts first opera in Vienna

Hannah Ellis-Petersen

Nick Edmonds — The Net Internation Investment Position and the Trade Balance

 

Paul Krugman oversimplifies the actual situation by assuming cet. par. when all things other than the independent variable almost never remain the same in the real world. It's the same kind of pseudo-argument about the future as debt and deficit hysteria based on "unfunded obligations" coming due in the future, along with eventual runaway interest on debt.

Reflections on Monetary Economics
The Net Internation Investment Position and the Trade Balance

Nick Edmonds

Sputnik International — China Warns It Won’t Allow Anyone to Use Hong Kong for Rebellion

On Sunday, the director of China's liaison office in Hong Kong, Zhang Xiaoming, said in an interview with state broadcaster CCTV that Beijing will not tolerate attempts to use Hong Kong as a base for rebellion.

"Hong Kong should never allow anyone to do any forms of activities that are harmful to China's sovereignty and security, to challenge the powers of the central government and the authority of the HKSAR Basic Law, or to take advantage of the HKSAR to engage in infiltrative and subversive activities to sabotage the social and political stability of the Chinese mainland," Zhang said. "These are the three bottom lines."

Drawing the (red) lines. Target? US and UK.

Sputnik International
China Warns It Won’t Allow Anyone to Use Hong Kong for Rebellion

Pat Lang — Manufactured hysteria - once again

As the "icing on the cake" the media now proclaim that the Intelligence Community is a vessel of integrity and patriotic self-sacrifice that, since it hints to us that "the Russians done it," must be believed without question. Well, pilgrims, those who really know the Intelligence Community know that these agencies are run be self-serving political hacks who may once have been people of integrity but who, by the time, they reach the top will say or proclaim anything that advances their personal interest.

Are we mad enough to believe such people? Perhaps Trump is not.

Sic Semper Tyrannis
Manufactured hysteria - once againCol. W. Patrick Lang, US Army (ret.), former military intelligence officer at the US Defense Intelligence Agency

See also

Looks like DJT has his crap detector turned on.

Reuters
No proof Russian hacking influenced U.S. election: Trump spokesman

Tony Cartalucci — Syria’s War Was Only Ever the Beginning

Documented.

NEO
Syria’s War Was Only Ever the Beginning

Tony Cartalucci

Moon of Alabama — Al-Qaeda Cut Leaves 5 Million Thirsty In Damascus - Western Media Unconcerned

There is a humanitarian catastrophe unfolding in Syria and the "western" media ignore it.
On December 22 al-Qaeda aligned Takfiris in the Wadi Barada valley shut down the main water supply for the Syrian capital Damascus. Since then the city and some 5-6 million living in and around it have to survive on emergency water distributions by the Syrian government. That is barely enough for people to drink - no washing, no showers and no water dependent production is possible.

This shut down is part of a wider, seemingly coordinated strategy to deprive all government held areas of utility supplies. Two days ago the Islamic State shut down a major water intake for Aleppo from the Euphrates. High voltage electricity masts on lines feeding Damascus have been destroyed and repair teams, unlike before, denied access. Gas supplies to parts of Damascus are also cut. A similar tactic was used by the Zionist terrorists of the Haganah who in 1947/48 poisoned and blew up the water mains and oil pipelines to Palestinian Haifa....

"Our guys" at work. Nothing to see here and not to worry, because "Assad must go."

Moon of Alabama
Al-Qaeda Cut Leaves 5 Million Thirsty In Damascus - Western Media Unconcerned
b

Steve Roth — How Do Americans Get Rich? (And Stay Rich?)

Wealth is generally conceived as a stock that is increased by the flow of income. But some wealth grows by itself, for example, equity prices based on market cap and real estate based on land rent. While interest is considered a type of income and is booked periodically (and is taxable in the period), asset appreciation that increases wealth is not considered income but capital gains and it is not booked (or taxed) until it is realized  even though it results in actual wealth accrual. Steve Roth poses some questions about this.

A huge aid to answering that question arrived last month. Gabriel Zucman, Emmanuel Saez, and Thomas Piketty (PSZ) released one of the most important pieces of economic research in the last century. Their Distributional National Accounts (DINAs) reveal the distribution of national income to different income classes, wealth classes, age groups, and genders (and potentially different races, etc. etc.). This has been unavailable in the national accounts, and as a result it’s absent in most macroeconomic empirical work.…

But impressive as they are, the DINAs don’t fully answer the question of how Americans accumulate wealth. Because the DINAs only tally income, and income doesn’t include households’ holding (or “capital”) gains on stock portfolios, real estate, etc. Income does include much “property income” — dividends, interest, etc. That’s income from owning things. But it’s not everything that households receive from ownership. Holding gains figure large in that picture.

Any investor will tell you: cap gains are a big part of their wealth accumulation. Total return — dividends plus capital gains — is the measure that most savvy stock-market investors care about, long-term (and that fund managers like to tout, loudly). And much of Americans’ retirement saving — especially middle-class Americans — is accrued through capital gains on their homes.

The DINAs’ central goal is to match income as presented in the national accounts, and to reveal a multidimensional pyramid of distributional data underneath that income measure. A deeply worthy goal. But as a result, the DINAs can’t and don’t reveal the whole picture of household wealth accumulation (change in assets and net worth), or its distribution.…

Wealth accumulation greatly exceeds saving from income, pretty much always and everywhere, over very long periods. And holding gains are not a small part of wealth accumulation, especially for already-wealthy households....

Evonomics
How Do Americans Get Rich? (And Stay Rich?)

Steve Roth | Publisher of EvonomicsSae

Robert Paul Wolff — One Last Word on Exploitation

The Philosopher's Stone
One Last Word on Exploitation
Robert Paul Wolff | Professor Emeritus, University of Massachusetts Amherst

Peter Radford — The Naivety of Economics

Moar on what's wrong with economics.

The Radford Free Press
The Naivety of Economics
Peter Radford

see also

Offer and Söderberg clarify the circumstances behind the shift in economics that occurred in the late 1970’s and came into full effect in the subsequent decades. Their focus is heavily on how the Nobel Prize in economics has reinforced that shift and how the very origins of the prize were steeped in political bias on the part of the Swedish Central Bank, which was involved at the time in a guerrilla war against the then prevailing (in Sweden) economics of social democracy.

This history is, perhaps, the clearest indication of the inherent anti-democractic intentions of modern economics.

This is the period in which neoliberalism was replacing the New Deal in the US and taking aim at social democracy in Britain and Europe.

The Market Turn

Bill Mitchell — Foreign sales of US government debt are largely irrelevant

… there was an article in Bloomberg media (December 30, 2016) – Beware the Foreign Exodus From Treasuries – stirring up fear about the recent sales of foreign-held US government debt. I guess it was a slow news day or something because there is very little in the story that is relevant to assessing whether the US government can run an appropriate fiscal policy stance. The fact is that the foreign sales of US government debt are largely irrelevant for the US government’s capacity to maintain its net spending program. 

The sales are in US dollars and only the US government itself issues those dollars. To think that a foreign purchaser of a US Treasury debt liability are ‘providing dollars’ to the US government is to completely misunderstand the nature of the transaction. This blog considers the current data and explains how to think correctly about these matters. The question that financial commentators really should be asking is why should the US government extend that corporate welfare (risk-free bonds with income flow) to domestic bond-buyers and foreign governments/private investors. 

There is no financial reason (in terms of facilitating fiscal policy) for the bond issuance. It is just a form of welfare spending which helps the top-end-of-town....

[Introduced paragraphing by topic sentence to improve online readability.]

Bill Mitchell – billy blog
Foreign sales of US government debt are largely irrelevant
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

More Public-Private Deals

ATC perhaps another area for Public-Private management.

Trump wants to privatize air traffic control, driving up ticket costs and risk of deadly crashes https://t.co/yHKqxY0c0t

— Max Blumenthal (@MaxBlumenthal) January 2, 2017

Acquisitors replacing Intellectuals

Trump loading up on other Acquisitors to replace Obama's Intellectuals within the context of Sarkar's Social Cycle Theory.

Our material systems outcomes should improve under these people's rule.

Trump's nominees "include five billionaires and six multimillionaires. This is what is known as oligarchy." https://t.co/6uxz6PBFRy

— Pedro da Costa (@pdacosta) January 1, 2017