The latest CPI report for the United States suggests that the inflation spike after 2020 was transitory in the rather weak sense that I understood the term “transitory.” I am curling in a bonspiel over the next few days, so I do have a long time to spend on this article, so I just want to outline my thinking on the topic of “transitory.”...Bond Economics
Mostly about political economy.
India PunchlineMichael Hudson foresaw this years ago, but the details were not yet clear at that time. Now it is unfolding. This is also the objective with the rest of the world, which is what "US hegemony" means economically.
MR OnlineConsolidation of markets at the hands of U.S. companies that are actively engaged in mergers and acquisitions raises an important question about the political ramifications of market concentration. Do mergers and acquisitions impact the lobbying clout of these acquisitive firms? A new working paper delves into this connection and finds some intriguing, if also preliminary, affirmative evidence.
“Political Power and Market Power,” by Bo Cowgill and Andrea Prat at Columbia Business School and Tommaso Valletti at the Imperial College Business School, documents a positive association between mergers and lobbying activities, and finds some evidence for a positive association of mergers with political campaign contributions. These findings and the economic model the co-authors employ in their research are not robust enough, as is, for U.S. antitrust enforcers to measure these connections between political power and market concentration quantitatively, though the findings advance conceptional frameworks for better understanding this nexus in the qualitative context of the political economy of the United States.…
Jeff Beck has died! A masterful musician. Very sad. We move on. I read an interesting research paper recently – “The Great Retirement Boom”: The Pandemic-Era Surge in Retirements and Implications for Future Labor Force Participation – published in the US Federal Reserve Bank’s Finance and Economics Discussion Series (released November 2022), which illustrates how the pandemic is altering the behaviour of the US labour market. The lessons from the US are relevant everywhere as governments progressively ignore the reality that a dangerous virus is still in our midst and still causing havoc (deaths, long-term disability and more). For those who are continuing to claim the pandemic is some sort of conspiracy to control us or that Covid is less dangerous than influenza or that mask wearing is redundant and all the rest of the nonsense that seems to perpetrated by some on the Left who think they are for ‘freedom’ and those on the Right who just care about profits, this sort of research should presents a serious wake up call....Bill Mitchell – billy blog
Maybe they are just going to use their capital to accept the Fed’s 5% subsidies and lay everyone else off?
Banks are telling you to buy stocks, saying the bottom is in & cancelling their recession calls for Europe.
— Financelot (@FinanceLancelot) January 11, 2023
Meanwhile, all of them are closing investments, departments & laying off staff.
Seems unusual, no? 🤔 https://t.co/99AUWXOkMP
Dimon now hoping for 6%:
Jamie Dimon says the Fed’s rate hikes might need to go beyond what’s currently expected. There's a 50% chance that the central bank will have to go to 6%, he says @FoxBusiness https://t.co/VikiBXSzMZ via @markets $JPM
— Steve Matthews (@SteveMatthews12) January 10, 2023
Oh no! …. “Inflation!”…. Fed better go up the 0.5% now!
Egg prices rise more than 64% in some stateshttps://t.co/natM1HoTr7
— FOX Business (@FoxBusiness) January 12, 2023
Yglesias out with another idea today:
New debt ceiling workaround just dropped — an idea for folks who find the platinum coin too silly. https://t.co/COhytbTHgv
— Matthew Yglesias (@mattyglesias) January 11, 2023
I guess: With policy rate at 5%; they sell a 1 year 10 face value with a coupon of 95 then people would pay 100 and get redeemed for 10... they would make the 5%... iow they would pay 100, get coupon for 95 then get back 10 at redemption in 1 year... pay 100 and get back 105 within a year...
USD savers would have their USD savings in the Treasury General Account at the Fed instead of in Treasury Securities accounts at the Fed… TGA account would probably maintain a VERY high balance…
By at least one measure, China now leads the world in producing high-quality science. My research shows that Chinese scholars now publish a larger fraction of the top 1% most cited scientific papers globally than scientists from any other country.
I am a policy expert and analyst who studies how governmental investment in science, technology and innovation improves social welfare. While a country’s scientific prowess is somewhat difficult to quantify, I’d argue that the amount of money spent on scientific research, the number of scholarly papers published and the quality of those papers are good stand-in measure…
Today, China is second only to the US in how much it spends on science and technology. Chinese universities now produce the largest number of engineering PhDs in the world, and the quality of Chinese universities has dramatically improved in recent year…
Our research also found that Chinese research was surprisingly novel and creative – and not simply copying western researchers. To measure this, we looked at the mix of disciplines referenced in scientific paper…
Taken together, these measures suggest that China is now no longer an imitator or producer of only low-quality science. China is now a scientific power on par with the U.S. and Europe, both in quantity and in quality.
Alongside the post-Cultural Revolution “reform and opening-up” policy, China’s higher education system transformed from a socialist egalitarian model into a “merit-based” model. In 1977, Chinese leader Deng Xiaoping officially resumed the <i>gaokao</i> [national test of the Mandarin period].
I’ve never understood the technical respect people have for google… it just takes your search word and inserts it into an advertisement ignorant of context... that’s all it really does …. I wrote that same program in high school back in the 80s … this ChatGPT thing might be a game changer…
ChatGPT vs Google: pic.twitter.com/53pbrVocDF
— ChatGPT (@ChatGPTGoneWild) January 10, 2023
Now we got'em on the ropes!
Russia’s budget deficit widens to a record as revenues plunge amid oil export restrictions and spending on the invasion of Ukraine grew https://t.co/duUhiufXzP
— Bloomberg Markets (@markets) January 10, 2023
Well, happy 2023 to all my readers. We are back for another year – the 19th in this blog’s existence. All the observers have been waiting for a sign that the US interest rate hikes are slowing the US economy down, which is the mainstream logic that has been used to justify the regressive policy shift. The data, so far, suggests that the inflationary pressures are subsiding as a consequence of the factors other than the interest rate changes which seem to have done little other than redistribute income to the rich away from the poor. The latest labour market data release from the Bureau of Labor Statistics supports that view. Last Friday (January 6, 2022), the US Bureau of Labor Statistics (BLS) released their latest labour market data – Employment Situation Summary – December 2022 – which revealed on-going employment growth, rising participation and falling unemployment. These are good signs for American workers. Further, as inflation is subsiding the modest nominal wages growth is now providing real wages growth – another virtuous sign. The latest data is certainly not consistent with the Federal Reserve type narratives. But who should be surprised by that....Bill Mitchell – billy blog
Banking is an ongoing area of controversy in popular discussion of economics and finance. What sets it apart from other areas of economic controversy is that it is not seen as contentious by the mainstream. This has meant that arguments are largely done at the fringes, and generally ignored by conventional economists. I see two main drivers of the difficulties in dealing with the subject: ideology and theoretical intractability.
Editorial note: this article is meant to be an introductory section of a chapter on banking in economic theory. I am going to make a bunch of wild assertions that are supposed to be dealt with later in the chapter. I expect that I will have follow up articles filling in details later....
Gallup interviewed adults in 122 countries across the planet. They found that 34% of people on Earth “always” feel at peace, while 39% “often” do, 17% “rarely” do, and 5% “never” do.
Nicaragua came in first place, with 73% of its population reporting it “always” feels at peace.
Gallup noted that “Latin American countries dominate the ‘always at peace’ list worldwide”.
There are 14 countries in the world where the majority of the population “always” feels at peace. A staggering nine of these 14 are in Latin America.
Nicaragua is No. 1, followed by El Salvador at No. 3, Panama at No. 4, Honduras at No. 5, Paraguay at No. 6, Dominican Republic at No. 7, Uruguay at No. 8, Colombia at No. 12, and Mexico at No. 14.
Biden’s consigliere:
Larry Summers reclining on a tropical island and instructing the proles that "there's going to need to be increases in unemployment to contain inflation" ☠️pic.twitter.com/t1ONYePsUZ
— David Adler (@davidrkadler) January 6, 2023
Nice guy!
LFG!!!! … hopefully the US defaults this time…
Biden people throwing down:
WHITE HOUSE SAYS CONGRESS WILL HAVE TO RAISE U.S. DEBT LIMIT, WITHOUT CONDITIONS
— *Walter Bloomberg (@DeItaone) January 8, 2023
Trump saying to use the ceiling to exact concessions from Democrats:
Looking real good for a default this time… 👍
Wall Street’s takeover of the American rental market really took off during Obama’s foreclosure regime as the firms snapped up properties (including from many small landlords) at bargain prices. The pace has continued to accelerat…
There’s constant media talk of a housing shortage to explain the US homelessness crisis, but according to the lawsuit against RealPage, one of its tactics is also keeping units off the market in order to drive up prices.…
By tightening its grip on the American rental market, Wall Street has helped cement the idea of a home as a commodity, spurred the assetization of housing, and embedded these assets in the international financial system. And an growing number of smaller landlords have learned to function like the big dogs on Wall Street.…
Speculative landlords are incentivized to evict tenants by the promise of higher rents, higher sale prices for vacated buildings, or the possibility of just leaving them vacant as the lawsuits against RealPage shows....
Speaking of a lot of money at stake, according to OpenSecrets, members of Congress invest more cash in real estate than any other industry, which has been true every year since 2008 when the research group first began tracking Congressmembers’ investments.
- As has been reported, it will only take a single congressperson, acting in what is known as a Jeffersonian Motion, to move to remove the Speaker if he or she goes back on their word or policy agenda.
- A “Church” style committee will be convened to look into the weaponization of the FBI and other government organizations (presumably the CIA, the subject of the original Church Committee) against the American people.
- Term limits will be put up for a vote.
- Bills presented to Congress will be single subject, not omnibus with all the attendant earmarks, and there will be a 72-hour minimum period to read them.
- The Texas Border Plan will be put before Congress. From The Hill: “The four-pronged plan aims to ‘Complete Physical Border Infrastructure,’ ‘Fix Border Enforcement Policies,’ ‘Enforce our Laws in the Interior’ and ‘Target Cartels & Criminal Organizations.'”
- COVID mandates will be ended as will all funding for them, including so-called “emergency funding.”
- Budget bills would stop the endless increases in the debt ceiling and hold the Senate accountable for the same
The GSCPI peaked at 4.3 standard deviations above its historical mean at the end of 2021, after which it declined substantially. The initial period of decline saw it drop to 2.8 by March 2022, after which it temporarily increased in April, primarily due to pandemic lockdowns in China and the Russia-Ukraine war. The GSCPI then experienced five consecutive months of declines, reaching a low of 0.9 in September. However, the past three months have witnessed a pause in the reversion to the historical average, with the index increasing by a total of 0.29 points in October and November before declining by 0.05 points last month, leaving the total three-month increase at about a quarter point. Synchronously, we have seen a worsening COVID situation in China. The goal of this post is to examine how much of the resurgent upward supply chain pressures can be attributed to China’s evolving policies in response to the current outbreak....Liberty Street Economics — FRBNY
As Beijing’s Belt and Road Initiative enters its 10th year, a strong Sino-Russian geostrategic partnership has revitalized the BRI across the Global South.The Cradle
The Fed and "inflation."
The LensBond EconomicsZoltan Pozsar is back with his stories about “Bretton Woods III” and the petro-yuan. (The original report is presumably for bank clients, but I found this summary by ER Valasco.) Although developing countries trading with China might take these developments seriously, from the perspective of the developed economies, how third parties arrange their affairs has limited domestic impact.I initially had a longer response, but once I looked it over, I decided it was too weak. I will instead offer a relatively brief response....
More monetarist reification from ChatGPT…
ChatGPT explains the Federal Reserve like Shaggy from Scooby-Doo: pic.twitter.com/aMY9c1i3b2
— ChatGPT (@ChatGPTGoneWild) January 2, 2023
