Sunday, November 30, 2014

Don't wait...sign up for next Saturday's commodity trading class!

Will you be ready for the next big commodity cycle?

It's only a matter of time before we once again see gargantuan moves in energy, metals, grains and soft commodities.

How will you trade them? How will your investment portfolio benefit?

Why not have a world renown commodity expert teach you how to trade the commodity markets!

Andy Hecht has been trading commodities for 35 years, including 20 years at Phibro, one of the world's most profitable and secretive commodity trading firms. Andy traded huge cargoes of metals, energy and agricultural commodiites.
Next Saturday, December 6, Andy will be giving an all-day, online intensive commodity trading course where he will teach you his secrets to successful commodity trading.


  • How the markets themselves cue you in to true fundamentals
  • Who the major players are and what they are doing
  • How to use technicals to grab profits away from funds and poorly informed speculators
  • Build a commodity component that will bring in big returns to your investment portfolio
  • How to arbitrage markets against each other for low risk, high profit gains
Plus...much, much, more!
The course will be taught online using Cisco's Webex platform. No special software is needed. It will be recorded for you to have for further review at your convenience.

In addition, attendees will get a copy of Andy's highly acclaimed book, "How to Make Money with Commodities."
Commodity Trading Course

Don't wait. Learn how to trade commodities from a pro. Sign up now for this one time opportunity while there is still space. Course fee is $995. Saturday, December 6, 9am - 4pm EST.

Sign me up...I want professional commodity trader Andy Hecht to teach me how to trade commodities!

t wa

David Glasner — What Is Free Banking All About?

I notice that there has been a bit of a dustup lately about free banking, triggered by two posts by Izabella Kaminska, first on FTAlphaville followed by another on her own blog. I don’t want to get too deeply into the specifics of Kaminska’s posts, save to correct a couple of factual misstatements and conceptual misunderstandings (see below). At any rate, George Selgin has a detailed reply to Kaminska’s errors with which I mostly agree, and Scott Sumner has scolded her for not distinguishing between sensible free bankers, e.g., Larry White, George Selgin, Kevin Dowd, and Bill Woolsey, and the anti-Fed, gold-bug nutcases who, following in the footsteps of Ron Paul, have adopted free banking as a slogan with which to pursue their anti-Fed crusade. 
Now it just so happens that, as some readers may know, I wrote a book about free banking, which I began writing almost 30 years ago. The point of the book was not to call for a revolutionary change in our monetary system, but to show that financial innovations and market forces were causing our modern monetary system to evolve into something like the theoretical model of a free banking system that had been worked out in a general sort of way by some classical monetary theorists, starting with Adam Smith, who believed that a system of private banks operating under a gold standard would supply as much money as, but no more money than, the public wanted to hold. In other words, the quantity of money produced by a system of competing banks, operating under convertibility, could be left to take care of itself, with no centralized quantitative control over either the quantity of bank liabilities or the amount of reserves held by the banking system.…
Uneasy Money
What Is Free Banking All About?
David Glasner

Saturday, November 29, 2014

CNN Poll: Majority of Americans say things are going well

For the first time since 2007, a majority of Americans think things are going well in the nation, a new CNN/ORC International poll found. 
It's a slim majority — just 52 percent of Americans said things are going well, while 48 percent said things are going badly — but it's the most positive appraisal of the state of the nation that the poll has found since January of 2007.…
No so much for the economy though.
Economic sentiments have improved over the past year as well. Though just one-third of Americans believe the nation's economy is starting to recover, that marks an 8-point increase from a year ago, when 24 percent said the same. 
A plurality, 41 percent, say the economy has stabilized, a 5-point improvement from November of 2013. 
And just 26 percent of Americans say the country's economic conditions are getting worse, a decline from the 39 percent who said so in 2013.
CNN Poll: Majority of Americans say things are going well
Alexandra Jaffe, CNN

Consumer confidence falling a bit.
The Conference Board Consumer Confidence Index®, which had rebounded in October, declined in November. The Index now stands at 88.7 (1985=100), down from 94.1 in October. The Present Situation Index declined from 94.4 to 91.3, while the Expectations Index decreased sharply to 87.0 from 93.8 in October.
November 2014 Consumer Confidence Survey®
The Conference Board

Dante Atkins — Senator Schumer: Labor's share of profit should be core of 2016 Democratic agenda

Bingo! That's not only a winner politically, it's also the correct response economically.

Daily Kos
Senator Schumer: Labor's share of profit should be core of 2016 Democratic agenda
Dante Atkins

See also Paul Rosenberg, Why are these clowns winning? Secrets of the right-wing brain at Salon.

The Democrats need a strong story more than a compelling rationale. More people tend to respond to a moving narrative rather than deep reasoning. It's the framing, stupid.

Steven Denney — South Korea’s Changing Attitudes on Inequality and Capitalism

Are Koreans becoming disenchanted with the local brand of capitalism?
The South Korean National Assembly (which has been uncharacteristically productive as of late) recently passed welfare reform legislation (three bills in total) to fix holes in the social safety net. Korean media identifies the impetus for the reform as coming from a particularly tragic triple suicide that occurred earlier this year, in which a mother and her two daughters took their own lives because of physical and financial hardships. As one illustration at the Hankyoreh suggests: The welfare system is broken and little is being done to help those at the lower end of the socioeconomic ladder. One might reasonably expect that social dislocations in the era of neo-liberal capitalism in South Korea might negatively affect how Koreans view the capitalism economic system. Indeed, the structure of South Korea’s economy and how Koreans view it has been the focus of more recent work on South Korean political culture.
The Diplomat

JW Mason — Five Thoughts on Monetary Policy

1. Monetary policy may operate on (a) the quantity of bank liabilities (money); (b) the quantity of bank assets (credit); the price of one or more assets relative to money (an interest rate); and/or (d) the price of money, normally relative to some other money (an exchange rate).… 
2. Regardless of which margin it operates on, monetary policy in its modern sense typically targets a level of aggregate output.… 
3. Orthodox macroeconomics confuses the issue by assuming a world of infinite liquidity, where anyone can spend as much they like in any given period, subject to an intertemporal budget constraint that their spending over the infinite future must equal their income over that same infinite future.… 
4. Getting back to reality, the fundamental tradeoff in the financial system is between flexibility and stability.… 
5. Policy is naturalized. The fundamental fact about monetary policy is that it is central planning that cannot speak its name.…

The Slack Wire
Five Thoughts on Monetary PolicyJW Mason | Assistant Professor of Economics, John Jay College, City University of New York

1-week left to sign up for Andy Hecht's intensive commodity trading course!

Will you be ready for the next big commodity cycle?

It's only a matter of time before we once again see gargantuan moves in energy, metals, grains and soft commodities.

How will you trade them? How will your investment portfolio benefit?

Why not have a world renown commodity expert teach you how to trade the commodity markets!

Andy Hecht has been trading commodities for 35 years, including 20 years at Phibro, one of the world's most profitable and secretive commodity trading firms. Andy traded huge cargoes of metals, energy and agricultural commodiites.
Next Saturday, December 6, Andy will be giving an all-day, online intensive commodity trading course where he will teach you his secrets to successful commodity trading.


  • How the markets themselves cue you in to true fundamentals
  • Who the major players are and what they are doing
  • How to use technicals to grab profits away from funds and poorly informed speculators
  • Build a commodity component that will bring in big returns to your investment portfolio
  • How to arbitrage markets against each other for low risk, high profit gains
Plus...much, much, more!
The course will be taught online using Cisco's Webex platform. No special software is needed. It will be recorded for you to have for further review at your convenience.

In addition, attendees will get a copy of Andy's highly acclaimed book, "How to Make Money with Commodities."
Commodity Trading Course

Don't wait. Learn how to trade commodities from a pro. Sign up now for this one time opportunity while there is still space. Course fee is $995. Saturday, December 6, 9am - 4pm EST.

Sign me up...I want professional commodity trader Andy Hecht to teach me how to trade commodities!

Ajay Shah — Consequences of reversing the controls on gold imports

Controls induce scarcity, and scarcity increases demand.

Ajay Shah's blog
Consequences of reversing the controls on gold imports
Ajay Shah

Friday, November 28, 2014

Peter Radford — Economics And Civil Society

I have been subject to quite a bit of push back on my repeated critique of the anti-democratic nature of orthodox/classical/neoclassical economics. 
So I am going to double down on the basis that when you’ve hit a nerve and produce a knee-jerk reaction it is wise to hammer away. 
Allow me to restate my opinion in brief: economics in the general tradition of Smith’s invisible hand up to and including the notions of Hayek, Friedman, and their disciples is, at its core, an attempt to conceive of a society stripped of politics. By this I mean it is an attempt to argue that passivity in the face of overwhelming “forces” that are “objective”, “decentralized”, and “systemic” will allow for an optimal distribution of wealth, and the attainment of the maximum possible total wealth compatible with that optimum. All that is needed is a goodly dose of rational decision making, a hopelessly large level of cognitive ability, enormous foresight, and an unobstructed view of absolutely everything.   
Oh, and under no circumstances ought there be any active interference in the economy to adjust the perfect outcomes. It is a perfect-in-perfect-out wonderland in which no one need concern themselves as to the ethics of the outcome. It is, after all, perfect. It cannot be improved upon. Free markets rule! 
This wonderland system, so constructed, will, we are assured, give back to everyone a return justified by their so-called marginal productivity. Mucking around in the system, no matter how well intentioned that activity might be, can only move society away from the optimum. It is, therefore, not possible for government action to improve the distribution of wealth. We all simply have to bow before the system and accept whatever it gives us. Hence the utter passivity of the vision. 
And hence the elimination of politics, since it is through politics of various kinds that humans arbitrate life, with economic outcomes merely being one aspect of that life.
I attribute the desire to eliminate politics to an early age in modernity when the world was still cluttered with arbitrary forms of government. The rising bourgeois class needed theoretical justification for a change in the power structure of the economy, and, in particular, it needed a way of neutering the tendency of autocrats, monarchs, and their ilk to get in the way of the accumulation of private wealth. 
Thus the success of Smith and his heirs....
This was the intention of the classical political liberalism of Locke and the economic liberalism of Adam Smith and devoid Ricardo. Marx called them out on what their agenda was.

Neoclassical economics can be viewed as the subsequent classical response to Marx, and also Henry George, who objected to the substation of one oligarchy, that of the haute bourgeoisie or "capitalists," for the old oligarchy of feudal aristocracy.

This transition was taking place at the time that Marx was writing and it was far from complete. That did not happen until after WWI. Neoclassical economics was already ready to step in as the paradigm for a capitalistic socio-economic paradigm, and it became the dominant political paradigm as neoliberalism.
To this day economists working in that tradition begin with a bias that all government is arbitrary at worst, or misguided at best. No matter what form of government. It is my contention such economists never took on board the arrival on the scene of democracy. Hayek et al are still fending off the evils of autocracy. They are living deeply entrenched in a past era. They have not adjusted to the reality of representative government when there is almost a one for one overlap between “we the people” as represented actively on the political system, and the so-called agents inhabiting the economic system.
I don't think that this is the case. The natural form of government under popular democracy as government of the people, by the people and for the people is some form of socialism, in which distribution is as significant as production. Mises and Hayek were minor aristocrats who were disturbed by the prospect of democracy overshadowing the better aspect of humanity by imposing a tendency toward the average man if not actually captured by an alliance of the worse. They were not alone. Those who are heavily influenced by neoclassical economics and neoliberal political theory tend to be conservatives in the sense of favoring the traditional social hierarchy in which the men are ruled by their betters. In time gone by, the criterion of being better lay in the use of arms whereas under the new organizational mode the criteria would be the ability to accumulate capital.

As the first Chief Justice of the newly established United States of America, John Jay, put it, "Those who own the country ought to govern it."
"By this constitution [NY State 1777] the right of suffrage was, in several instances, restricted to freeholders; it being a favourite maxim with Mr. Jay, that those who own the country ought to govern it."
Son William Jay in Life and Opinions of John Jay (1833).
This is clearly quite different from Abraham Lincoln's "government of the people, by the people, and for the people" in the Gettyburg Address, and it is much closer to the intent of neoliberalism and its foundation in neoclassical economics, which provides the rationale for meritocracy and distribution according to "just deserts" based on marginalism.

Under the rule of the capitalists, production and therefore capital formation was regarded as primary and distribution was assumed to follow "natural" market forces if individuals were left free to pursue self-interest and there was no limit on accumulation. There needed to be no limit on accumulation in order to facilitate capital formation as the primary driver of economic progress. Influenced heavily by pseudo-Darwinist Herbert Spencer, who was perhaps the leading intellectual of that time, the late 19th century was all about progress and that has carried over to present times. Neoclassical economics and neoliberal political theory are products of that ideology.

In essence this was an attack on popular democracy.

Radford realizes this.
In a democratic system the people who comprise the market are those who comprise the government. To criticize one ought to be to criticize the other. To idolize one ought to be to idolize the other. You cannot have it both ways. 
Unless, of course, you disagree with the outcomes of one of the systems. 
And since economists working in the Smith through to Hayek/Friedman tradition are unrelenting in their criticism of all things governmental, I can only deduce that they disrespect if not despise democracy. Which, perhaps it escaped their notice, is our current form of government.
Well, there are different forms of democracy. There is popular democracy as opposed to representative democracy, that is actual democracy rather than republicanism, which favors the elite. There is a difference between participatory democracy and being present with limited slates of preselected candidates for office. Actual democracy as the rule of the people (demos) is quite different from oligarchic "democracy" of plutonomy, in which the ownership class selects the candidates, dictates the laws and regulations, and places its minions and cronies in positions of power through the revolving door.

Radford is correct in saying that classical economics arose at a time when the issue was autocracy and feudalism, so that early liberalism was oriented against "government" in this sense. However, neoclassical economic and neoliberalism as a politics theory continued in this vein even after the triumph of liberalism and the transition to democratic government. Then the objective became to bridle popular democracy by introducing the "natural" oligarchy of plutonomy where the "makers" would rule the "takers."
By being so in the thrall of so-called invisible hands, so-called free markets, so-called equilibria, so-called marginal productivity and the other paraphernalia of the Smith-Hayek/Friedman tradition, they simply reveal themselves to be anti-democratic.
The Radford Free Press
Economics And Civil SocietyPeter Radford

E-book — Alternatives to Capitalism: Proposals for a Democratic Economy by Robin Hahnel and Erik Olin Wright

New Left Project’s new e-book, Alternatives to Capitalism: Proposals for a Democratic Economy, is now available for download. 
In it the leading radical thinkers Robin Hahnel and Erik Olin Wright take on the crucial but all-too neglected question: what kind of society should we be fighting for instead of capitalism? 
Hahnel favours ‘participatory economics’. Wright advocates ‘real utopian socialism’. Alternatives to Capitalism puts these practical proposals through their paces in an in-depth, frank and extremely instructive debate about the central question of our time. 
•   Download the book for kindle, free. 
•   Buy the book on Amazon. 
•   If you don’t have a kindle, you can read it by downloading a kindle previewer. 
•   A pdf version will be available soon - watch this space. 
We will be posting excerpts from the book on NLP over the coming weeks. First up, read the introduction.
 New Left Project
Alternatives to Capitalism: Proposals for a Democratic Economy
Robin Hahnel and Erik Olin Wright
h/t Jan Milch

Amartya Sen — Social Choice and Social Welfare

On Kenneth J. Arrow's Impossibility Theorem.

Project Syndicate
Social Choice and Social Welfare
Amartya Sen

Thursday, November 27, 2014

Thomas Piketty is right: Income inequality is holding us back — Lynn Stuart Parramore interviews Barry Cynamon and Steven Fazzari

Barry Z. Cynamon, currently Visiting Scholar at the Federal Reserve Bank of St. Louis, and Steven M. Fazzari, Professor of Economics at Washington University in St. Louis, are researchers on consumer behavior and how it affects the economy. They wrote an op-ed for the St. Louis Post Dispatch in October 2007 in which they predicted that an end to the relentless trend of rising household debt and a subsequent crash in household spending could lead to a killer U.S. recession. Soon after, their prediction came true. Their current work, which examines how high and rising inequality is holding back the American economy, is part of the Institute for New Economic Thinking’s project on the Political Economy of Distribution. They explore how the massive debt which led to the Great Recession, the spending collapse that followed, and the stagnation that persists are all linked to income inequality. In the following interview, they discuss what their findings mean for America.
Thomas Piketty is right: Income inequality is holding us back
Lynn Stuart Parramore interviews Barry Z. Cynamon and Steven M. Fazzari

Happy Thanksgiving from MNE!

Dave Majumdar — The Russian Air Force's Super Weapon: Beware the PAK-FA Stealth Fighter

Cold War 2 report. China is also in the mix with its Chengdu J-20 and Shenyang J-31.

National Interest
The Russian Air Force's Super Weapon: Beware the PAK-FA Stealth Fighter
Dave Majumdar

Spiegel — Summit of Failure: How the EU Lost Russia over Ukraine

The blow by blow.

Spiegel Online International
Summit of Failure: How the EU Lost Russia over Ukraine

Princes of the Yen: Central Banks and the Transformation of the Economy

Princes of the Yen: Central Banks and the Transformation of the Economy
based on a book by Richard Werner

Mathematics Of Human Return-On-Coordination ... Pattern-Recognition Prerequisites Modeled

   (Commentary posted by Roger Erickson)

Did prehistoric conflict hastened human brain's capacity for collaboration?
Sure. Experienced rugby players would tell you that, and chimpanzees too, if they were interested in talking more. :)

As you might guess, the distributed return-on-coordination tracks both pattern-recognition skills AND group practice.

If specific neural organs like the cerebellum help mediate smooth coordination among all the muscles & countless muscle fibers of the human body ...

... then what specific CULTURAL ORGANS might - with enough aggregate practice - continuously mediate more return-on-coordination across entire markets, economies, cultures and nations?

You name it. The future's the limit.

Peter Cooper — Marx’s View of Production in Relation to MMT and Taxes

An effect of being trained in mainstream economics but then encountering alternative approaches is to experience a growing realization — or at least a creeping suspicion — that most of what has been taught is the opposite of the truth. Even when the story told contains some truth, it is likely to have been turned on its head. Thanks to Kalecki and Keynes, for example, it becomes clear that demand (spending) determines supply (income), including in the long run. Spending, in a monetary production economy, must come before production can commence. Thanks to Post Keynesians, it becomes evident that loans create deposits, not the reverse. There could be no deposit prior to the decision to extend the first private or public loan (unless through government spending). Thanks especially to Sraffians, it has been established that profit cannot be a remuneration for productive contribution. We can conceptualize profit as unpaid labor (Marx) or due to ownership (Sraffians, Post Keynesians).
An observation due to Modern Monetary Theory (MMT) that sometimes meets with resistance, though in my view is convincing, is that government spending or lending is logically prior to the receipt of tax revenue or government borrowing. This is a recognition that, from inception, government must issue its currency (spend or lend) before reserve accounts can be debited. 
I often ponder this and other aspects of MMT in relation to Marx. In this regard, a statement made by Yanis Varoufakis in a fascinating presentation recorded in May 2013 caught my attention. Here, I will use it as a springboard for a brief consideration of Marx in relation to MMT on the question of fiscal policy, without intending to imply that Varoufakis would necessarily agree with the interpretation (or with MMT, for that matter).
Marx’s View of Production in Relation to MMT and Taxes
Peter Cooper

Complaining About Your Own Clerks Is A Symptom Of A Failed Aggregate.

   (Commentary posted by Roger Erickson)

I sympathize, but that complaint is so overly simplistic that it hurts more than it helps.

It is sellers who offer credit to buyers who pay over time, and with diverse substitutions.

That's how we create the increasingly complex transaction chains called an aggregate economy. 

For the most part, banks just denominate those credits & debits, although they often act as publicly "licensed" middle-men or market-makers who manage distributed liquidity on behalf of the public at large. 

Denominating distributed credit & dynamic liquidity is a necessary but not sufficient part of continuously increasing our cultural adaptive rate. Don't even think of throwing that baby out with the bathwater.

Bankers are accountants for the electorate. They are simply clerks who manage our books for us. It's up to US to regulate their behavior and pay.

An aggregate complaining about it's clerks is exactly like bad parents complaining about the behavior of their own kids.

Face it. If our aggregate is dissatisfied with their own servants, both the problem and solution are visible in the aggregate mirror. So just look closer, and help regulate this aggregate's own behavior.

Complaining about YOUR OWN CLERKS is a symptom of a failed aggregate. The solution is always to examine your group's own state of distributed organization, and come up with a way to coordinate on an even larger scale.

Look no further than your own mirror. Continuously finding new methods, for continuously scaling up all the expanding features of an adaptive culture ... well, that task is up to us, not anyone else.

When you look in your mirror, do you see only the static components and static values? That's just what was already produced yesterday.

Look closer and longer and, upon reflection, discern the return on coordination and the many dynamic values, already present, plus those which are always newly emerging.

Once you can recognize dynamic value, it should be obvious how to re-regulate bankster behavior and more optimally manage the behavior our lowly bank clerks. Just start acting like a co-owner ... of democracy. If YOU don't act like an owner, don't expect your lowly clerks to not act like they own you.

Wednesday, November 26, 2014

Conservation In The Time Of Control Fraud

(Commentary posted by Roger Erickson.)

Conservation In The Time Of Control Fraud

This is an interesting story on the role of Hank Paulson in personally funding conservation in China.

What are your thoughts while considering Hank Paulson simultaneously involved in conservation PLUS epic financial looting the last 15 years?

That brings up contradictory implications of Biblical proportions. Forget Peter, Hank's been robbing the entire US MiddleClass to pay Paulson, and apparently feels compelled to do penance by conserving some but not all habitats.

Maybe Hank's funding a private reserve for Control Frauds, so they'll never again have to get down on bended knee in front of their victims & accomplices.

Wouldn't Middle Classes everywhere do a far better job of conserving their own environments if they weren't robbed blind beforehand? No habitat for the human Middle Class?

Methinks "Herr-los" Paulson is uselessly robbing his own mirror here. He can't see the conservation for the robbery, so he vainly pursues one in order to try to personally fund the other.

Hank, Hank, Hank. Just give it a rest? NeoLiberalism is not a prerequisite for Christian Scientists.

A surprising inability to see the big picture? Or a massive, purposeful Control Fraud, and an outright traitor to his own nation, in more ways than one. So far, no court has subpoenaed Hank to find out, nor investigated him thoroughly enough to display the implications for an American ex Middle Class that has yet to decide how to respond to Hank's weirdly selective conservation efforts.

Zach Przystup — China-US Relations: The Return of Mao’s Noose

‘The U.S. and China are locked in a great power competition, and their primary goals are incompatible.’…
National visions are powerful motivators. For the U.S., a national vision of liberal democracy and free markets has translated into permanent forward deployment of the U.S. military and the world’s largest alliance system. Underlying this forward strategy is the belief that liberal democracy is the best form of government, and that it must be protected at home and given to others when possible. This American vision is less than three centuries old; China’s view of itself as the center of the universe goes back thousands of years. As scholar Yan Xuetong notes, Chinese people believe China’s fall from preeminence to be “a historical mistake which they should correct.” If it is true that old habits die hard, the main tenets of China’s national vision are unlikely to change. 
By pivoting to Asia, Washington is placing a bet that Beijing desperately wants to avoid a disastrous conflict as much as it does, and that the status quo in the region will endure. By tightening the noose, Beijing is trying to call its bluff. As Sun Tzu might observe, both sides are trying to win without fighting. 
For now, that may be a viable strategy. But even if China continues its steady growth, avoids threatening its neighbors, and generally demonstrates that it is a responsible stakeholder in the international system, it is inconceivable that it would allow another superpower to have the best real estate in its own neighborhood. At some point, the U.S. and China’s national visions will collide. When that happens, Washington and Beijing will both have to make a monumental decision about the future of East Asia, and the rest of the world.
The Diplomat
China-US Relations: The Return of Mao’s Noose
Zach Przystup | Assistant Director for Global Executive and Diplomatic Education at The Fletcher School of Law and Diplomacy at Tufts University

Aditya Velivelli — The deadly land policies planned by Modi’s advisers and the links to Ukraine and Honduras

I don't know where to begin to summarize this it has so much intrigue where the stake runs into the multi-billions. And Pierre Omidyar is right in the middle of it. This land scheme is right out of the playbook of ultra-neoliberal economist Hernando De Soto who contends that land titling is the magic wand to lift poor nations out of poverty through legal systems establishing (private) property rights. It's another iteration of enclosure.

The deadly land policies planned by Modi’s advisers and the links to Ukraine and Honduras
Aditya Velivelli

Tuesday, November 25, 2014

UK Parliament debates money, QE, and banking

Last week, the UK Parliament held a debate on modern money, touching on banking, QE, interest rates, and inflation. This debate was almost certainly the result of the bold video and paper released by the Bank of England earlier this year. Many of the MMT talking points were spoken by MP's, to my great pleasure.

The debate was led off by Conservative MP Steve Baker. He got many things right at first, however later divulged into hyperbole about QE and inflation, while bringing up traditional Hayek talking points about 'price discovery.' Later comments by Labour MPs were more on point.

The UK Positive Money site picked up this debate and covered it here. 

Watch the entire debate here. Its certainly very depressing to see our friends across the pond having a honest, detailed debate about money. Meanwhile, many members of the US Congress are seriously considering impeachment of the sitting president.

David F. Ruccio — Piketty wars: episode III—revenge of the Right

 Phil Gramm and Michael SolonJohn Cochrane, and Deirdre McClosky. 

Because liberalism is self-organizing and self-regulating, you know, like nature. May be not perfect but the best that nature could do with the resources at her disposal. Quit complaining and enjoy the prosperity. In liberal societies even the poor have TV's. Celebrate freedom.

Occasional Links & Commentary
Piketty wars: episode III—revenge of the Right
David F. Ruccio | Professor of Economics University of Notre Dame Notre Dame

Russia — Insider Astounding: Top Ukrainian Politician Explains his Nazi Beliefs

Full-on Nazi.

The interesting matter is that the Right Sektor won a relatively few seats in the recent election, but its leaders have been appointed to top government positions.

Peter Radford — McCloskey Disses Democracy

Peter Radford takes down Deirdre McCloskey's take down of Thomas Pikettythat Greg Mankiw opined was "compelling".

This is a good one. Here are a couple of excerpts for the flavor.
Actually it’s McCloskey dissing what she calls leftish economists generally, although poor Piketty and his notorious book provides the moment she seizes to attack us misguided folk. Riven through with fundamental error and hopelessly soft we have all, apparently, misunderstood the great sweep of history. 
The lesson from which is that all is swell if we just leave it alone. We need to set aside our petty and foolish concerns about the environment, and a whole host of other nonsense about market imperfections – and, yes, government imperfections too – we need to acknowledge the great wealth that surrounds us, and gorge on the pile of goodies that capitalism has brought us.…

If the great spirit in the sky was working tirelessly throughout those two hundred years or so, then surely the benefits ought to have accrued more evenly. Why is the material leap more focused towards the end? At least for the ungrateful poor who don’t realize they are actually wealthy.
Perhaps it had something to do with democracy. Or, alternatively put, the push back by folk like my grandmother against the system that seemed to be permanently stacked against them. They voted repeatedly to distribute wealth more evenly, to limit the risks of living in the spirit’s system, and to otherwise guard against to excesses of the capitalists. They had a sense of balance. A sense that allowed the economic system to flourish but within more decently proscribed limits. Distribution was important because it allowed everyone to feel an equal participant. Excess undermines that feeling. 
Yes, Deirdre, distribution does matter. It matter s a lot. In fact it matters so much that rightists – I resist the obvious impulse to use the word “wrongists” – wanting to defend the great spirit in the sky ought to pay very great attention. 
Because maldistribution can, and I will stay polite here, mess things up. Big time. Really big time. It creates political problems in a democracy. And that then creates problems for the economy.
The key point:
The tradition in which McCloskey sits, denies forcibly and very loudly that the government can play any role whatever in the economy. It has constructed an entire intellectual edifice – Smith-Say-Mises-Hayek-Friedman et al – to enforce that denial. It has sought to interfere in the democratic process in order to neuter any influence that process might have.
Like I've been saying capitalism and democracy are antithetical.

The Radford Free Press
McCloskey Disses Democracy
Peter Radford

Best line: "The system-we-cannot-name is rooted in venal bourgeois values. You said so yourself Deirdre."

Monday, November 24, 2014

Malaysia Today — MH17 – A Scandal In The Making

I am a Dutch citizen who lives here in Malaysia. This morning I read some news regarding MH17 in Elsevier, a worthy Dutch news magazine. 
As you should know the Dutch government signed an agreement with 3 other countries (Belgium, Australia and Ukraine) about the manner in which the JIT would investigate the MH17 disaster. 
According to Elsevier sources, this (secret) agreement has one condition that ensures all parties within the JIT group (including Ukraine) have the right to secrecy. In other words: if any of the parties finds that certain evidence might be damaging, it is entitled to demand complete secrecy by all JIT members. 
Of course an incredible situation: how can Ukraine, one of the two suspected parties, ever be offered such an agreement?…
Besides the fact that the MH17 plane was Malaysian territory and Malaysia was not even allowed to join the JIT this is an absolute scandal of epic proportions. It shows the JIT investigation for what it is: a corrupt and useless exercise.
Malaysia Today
MH17 – A Scandal In The Making
Jan Fluitketel

Izabella Kaminska — On the hypothetical eventuality of no more petrodollars

Imagine the scenario. It’s 2025 and the volume of home-produced oil is so great that the US is near energy independent as far as crude imports are concerned. 
With that energy independence, the amount of dollars flowing out of the US and over to net energy producers (and traditional dollar reserve hoarders) such as Saudi Arabia, Russia and Mexico has come crashing down. 
So how would such a dollar-flow contraction affect the global economical and political balance? 
According to Citi’s credit team, it would likely affect things a lot.…
The Financial Times — FT Alphaville
On the hypothetical eventuality of no more petrodollars
Izabella Kaminska

Evan Halper — White House threatens to put brakes on alternative fuels

As biotech masterminds and venture capitalists scramble to hatch a new generation of environmentally friendly fuels that can help power the average gasoline-burning car, they are confronting an unexpected obstacle: the White House. 
Yielding to pressure from oil companies, car manufacturers and even driving enthusiasts, the Obama administration is threatening to put the brakes on one of the federal government's most ambitious efforts to ease the nation's addiction to fossil fuels. 
The proposed rollback of the 7-year-old green energy mandate known as the renewable fuel standard is alarming investors in the innovation economy and putting the administration at odds with longtime allies on the left.
Even the Third Way is against the White House on this.
"It is disheartening to see how much potential to slow climate change we are missing out on by not doing this," said Ryan Fitzpatrick, a clean energy adviser at Third Way, a Washington group that seeks bipartisan policy solutions.
Read more here:
White House threatens to put brakes on alternative fuels
Evan Halper | Tribune Washington Bureau

Read more here:
At this rate Obama is going to take the title of worst president ever from W.

Robert Parry — Possible Motives for Ousting Hagel

Six years into his presidency, Obama still doesn’t seem to understand that just because some people have impressive credentials doesn’t mean they know what they’re doing. Indeed, in a profoundly corrupted system – like the one that now controls Official Washington – rewards are handed out to people who serve the corrupt interests or at least don’t get in the way. 
In a time of corruption, the countervailing forces of wisdom and courage will never be found among the credentialed, but rather among the outcasts of the establishment, those who were forced to the margins because they objected to the venality, because they stood up against misguided “group think.” 
But Obama has been unwilling – or possibly unable – to come to grips with this reality. Despite his personal intelligence and rhetorical skills, Obama never has been willing to challenge people cloaked in credentials – those who went to the best schools, worked at big-name firms, won prestigious awards or held fellowships at famous think tanks. 
The tragedy of Obama is that I’m told that he understands the stupidity of the modern U.S. establishment and does sometimes consult with “realists” who offer practical advice for how he can resolve some of the most nettlesome problems facing the United States around the world. But he does so virtually in secret, with what politicians like to call “deniability.”
Consortiums News
Possible Motives for Ousting Hagel
Robert Parry

See also Paul Pillar, The Risks of No Iran-Nuke Deal

The actual risk to the US, although Pillar doesn't mention it, is China stepping in. A Russian, Chinese, Iran alliance would really give the neocons heartburn, and this seems to be the trajectory in which US (neocon) intransigence is pushing.

Henry Giroux — Current "Reforms" Attempt to Drive Young People Out of Democracy

"I think that what we have seen since the 1980s is the recognition on the part of the right that the educative nature of politics is really crucial and important. They want to take control of those institutions that produce particular kinds of subjects, dispositions, attitudes, particular modes of desire that are compatible with market values and market social relationships. So the school becomes a reproductive tool that aligns itself with the belief that the market has the ability to govern all social life," Giroux tells Camilla Croso in this interview. "Schools are public spaces and by default, they are at odds with a market rationality. The people who control corporate power globally, today, have no interest in the public, public values or public goods."
HG: Actually, the public as a democratic public sphere that encourages critical dialogue and an engaged citizenry is the enemy of the market for them because it's a non-commoditized sphere that basically can produce all those things that are considered hazardous to corporate interests. That is, it produces people who can imagine otherwise and hence act otherwise; it can produce people who believe in thoughtfulness, critical exchange, civic courage [and] social responsibility, and are more than willing to hold power accountable. Public spheres are places in which thinking becomes dangerous and, in that sense, they have to be shut down. 
Furthermore, there is an enormous effort on the part of the right, all over the globe, to privatize these public spheres and to turn them into risk-free investments for accumulating capital and profits for the relatively few, for the rich, for politicians, all of whom then can make enormous amounts of money off them. They can disempower faculty, they can treat students as consumers and they can basically use them as a way to accumulate capital. 
Henry Giroux: Current "Reforms" Attempt to Drive Young People Out of Democracy
Camilla Croso, Latin-American Campaign for the Right to Education | Interview
Henry A. Giroux currently holds the McMaster University Chair for Scholarship in the Public Interest in the English and Cultural Studies Department and a Distinguished Visiting Professorship at Ryerson University. His most recent books include: Youth in Revolt: Reclaiming a Democratic Future (Paradigm 2013), America's Educational Deficit and the War on Youth (Monthly Review Press, 2013), Neoliberalism's War on Higher Education (Haymarket Press, 2014), and The Violence of Organized Forgetting: Thinking Beyond America's Disimagination Machine (City Lights, 2014). The Toronto Star named Henry Giroux one of the 12 Canadians changing the way we think! Giroux is also a member of Truthout's Board of Directors. His website is
Giroux is becoming one of the leading public intellectuals of the left.

F. William Engdahl — Russia Turns East at Shocking Speed with China Mega Energy Deals

While Western mainstream media concentrates attention on the emissions agreement signed by US President Barack Obama and Chinese President Xi at the recent APEC Beijing Summit, Russia’s Putin and China’s Xi quietly signed major new energy agreements that will have enormous geopolitical significance in bringing about the very nightmare that US strategists such as Zbigniew Brzezinski warned about way back in 1997 when America seemed indomitable as sole Superpower.…
They reportedly discussed “the current international and regional security situations, regional issues as well as the relationship between the two militaries”, said Xinhua. One can wonder just what those “situations” might be, perhaps the brazen US and EU intervention into Ukraine to give the excuse for financial warfare and a proxy war against Russia, and perhaps the US National Endowment for Democracy’s “Umbrella Revolution” in Hong Kong, designed to rattle Beijing as well as the Obama “Asia Pivot” military focus on China? The Washington neo-conservative hawks and their backers in the CIA, State Department and NSC are managing to accelerate the very Eurasian alliance that is they are trying to destroy.…First appeared:
New Eastern Outlook
Russia Turns East at Shocking Speed with China Mega Energy Deals
F. William Engdahl

See also Hungary’s Viktor Orban: Washington’s New Enemy ImageFirst appeared

Janet Allon — Paul Krugman: Deluded New Majority in Congress Insists We're Living in an Ayn Rand Novel

The new meme is the same as the old meme — reduce dependence on government by eliminating the nanny state and instituting a night watchman state that is solely focused on security and property.

Paul Krugman: Deluded New Majority in Congress Insists We're Living in an Ayn Rand Novel
Janet Allon

Paul Verhaeghe — Neoliberalism has brought out the worst in us

An economic system that rewards psychopathic personality traits has changed our ethics and our personalities… 
We tend to perceive our identities as stable and largely separate from outside forces. But over decades of research and therapeutic practice, I have become convinced that economic change is having a profound effect not only on our values but also on our personalities. Thirty years of neoliberalism, free-market forces and privatisation have taken their toll, as relentless pressure to achieve has become normative. If you’re reading this sceptically, I put this simple statement to you: meritocratic neoliberalism favours certain personality traits and penalises others.…
There are constant laments about the so-called loss of norms and values in our culture. Yet our norms and values make up an integral and essential part of our identity. So they cannot be lost, only changed. And that is precisely what has happened: a changed economy reflects changed ethics and brings about changed identity. The current economic system is bringing out the worst in us. 
The Guardian
Neoliberalism has brought out the worst in us
Paul Verhaeghe | Professor and Chair of the Department for Psychoanalysis and Counseling Psychology, Ghent University

Branco Milanovic — Why individualism does not necessarily imply preference for a minimalist state?

Rand, Mises, Hayek, and left libertarianism briefly compared and contrasted.

Global Inequality
Why individualism does not necessarily imply preference for a minimalist state?
Branco Milanovic

John Helmer — Circle The Russian Wagons – Belief In Patriotism, Sacrifice, And Putin Rise In Reaction To Us, Eu Sanctions, Media War

Russians digging in for the long haul?

What he doesn't mention is how long Europe can wait impatiently watching its Russian markets slipping to development in Russia and substitution from non-Western countries.

Dances with the Bears
Circle The Russian Wagons – Belief In Patriotism, Sacrifice, And Putin Rise In Reaction To Us, Eu Sanctions, Media War
John Helmer

Neil Wilson — The Sovereign Money Illusion

Another money illusion deconstructed.


Sunday, November 23, 2014

Eric Zuesse — U.S. Among Only 3 Countries at U.N. Officially Backing Nazism & Holocaust-Denial; Israel Parts Company from Them; Germany Abstains

More US soft power erosion.
Ukraine voted no on this resolution because this new Ukrainian Government is the only nazi regime in the world, and they are doing the standard nazi things, and so what they are doing is in violation of numerous international laws, which are not being enforced, but which are re-asserted and re-affirmed in this resolution, though Ukraine and the Ukrainian situation aren’t at all mentioned in the resolution. The United States voted no on it, because the U.S. Government had placed them into power. And Canada voted no on it because their far-right Prime Minister, Stephen Harper, has been a virtually unquestioning supporter of all U.S. foreign-policy positions, and wants U.S. President 
Barack Obama to approve construction of the Keystone XL pipeline to assist the Koch brothers and other large oil giants to profitably transport and sell to Europe and around the world, tar-sands oil from Canada’s landlocked Athabasca region. 
Germany abstained from voting on this resolution because their leader, Chancellor Angela Merkel, does not want to offend the U.S. President by voting for a resolution that the U.S. Government strongly opposes; and also because, as today’s leader of the land where nazism started — in the first nazi political party, the Nazi Party of Germany — she does not want Germany to vote against a resolution that condemns Nazism. If Germany were to have voted against this anti-nazi resolution, she would have faced a political firestorm at home. So, Germany abstained, in order not to offend Obama on the one side, and her public on the other. 
Key to understanding the vote on this resolution is knowing the relevant historical background, which has largely to do with the world’s only nazi-led Government: today’s Ukraine. Consequently, the remainder of this article will explore that issue in depth, so that this otherwise-incomprehensible U.N. vote will become comprehensible.
Washington's Blog
U.S. Among Only 3 Countries at U.N. Officially Backing Nazism & Holocaust-Denial; Israel Parts Company from Them; Germany Abstains
Eric Zuesse

Steven Teles — Restrain Regressive Rent-Seeking

America today faces three great challenges. Inequality, driven in particular by a spike in incomes at the very highest end, is threatening the public’s belief in the justice of our economic system. Innovation in products and services that actually add to human flourishing and produce meaningful employment, driven by new firm formation, appears to be stagnating. Finally, Americans both on the right and left increasingly believe that our political system is rigged to benefit organized insiders, while critical public problems remain unaddressed.… 
The standard image of how our economy works, and where the wealth of a good chunk of the 1 percent comes from, is wrong. The really important question, if we want to put our economy on a trajectory of greater productive innovation, less inequality, and more political legitimacy, is what explains this explosion of upward redistributing rent? How did this happen at a time that all of the political conversation was about the wonders of markets? How, if at all, might we actually restructure our politics to make it possible to claw back these rents, thereby liquidating unjust politically-protected fortunes, creating space for greater economic opportunity, and unleashing greater innovation?
Cato Institute
Restrain Regressive Rent-Seeking
Steven Teles | associate professor of political science at Johns Hopkins University
h/t Brad DeLong

Finian Cunningham — Europe Veering From US Abyss Over Russia?

It’s long overdue but better late than never that Europe might just be back-pedalling on America’s aggressive agenda towards Russia. The business-like visit to Moscow this week by Germany’s Foreign Minister Frank-Walter Steinmeier suggests that Europe can come to its senses to seek a diplomatic resolution of the escalating tensions over the Ukraine crisis – tensions that could spark a wider continental war, or worse.
Steinmeier met with his Russian counterpart Sergei Lavrov in which the pair stressed the need to find a political end to the violence in Ukraine. The German diplomat – the first high-level European envoy to Moscow in several months – also talked about normalising relations between his country and Russia and of finding a way to rescind the economic sanctions that Brussels has imposed on Moscow over recent months.

EU ministers in Brussels balked at imposing a fourth round of sanctions earlier this week, showing a growing division over the policy among European governments.

Interestingly, Steinmeier said his visit to the Russian capital was following up on positive discussions held last weekend with President Vladimir Putin at the G20 summit in Australia. The German foreign minister said the task now was to prevent a new spiral of violence in Ukraine.

Given that Germany is the European Union’s largest economy, we can fairly say that Berlin’s political attitude is going to hold sway for the rest of the bloc.

Meanwhile, the contrast with the European attitude, as seen this week through Steinmeier, could not be sharper in Washington.
Germany blinks. Putin and Xi chuckle. Obama, McCain and the neocons fume.

Strategic Culture Foundation
Europe Veering From US Abyss Over Russia?
Finian Cunningham


Oriental Review
The Usa And Nato Have Hammered Out The Cold War 2.0 With Russia. How To Overcome It?
Valdimir Kozin | Professor of the Russian Academy of Military Sciences

Adam Parsons — Sign me up to Russell Brand's sharing revolution

“The agricultural Revolution took thousands of years,” he writes, “the industrial Revolution took hundreds, the technological tens. The spiritual Revolution, the Revolution we are about to realise, will be fast because the organisms are in place; all that needs to shift is consciousness, and that moves rapidly.”
Open Democracy
Sign me up to Russell Brand's sharing revolution
Adam Parsons

Daniel Little — How professionals think

The topic of how actors arrive at their choices and behavior has come up a number of times here. The rational choice model has been considered (link), and other, more pragmatist approaches to agency have been considered as well (link). Finally, a number of posts have considered the idea of character as a key determinant of action (link). 
A team of distinguished experimental economists have recently provided a different perspective from any of these on the subject of agency and action. Alain Cohn, Ernst Fehr, and Michel André Maréchal recently published a provocative piece in Nature that appears to show that a certain segment of white-collar professionals (bankers) make very different decisions about their actions depending on the “frame” within which they deliberate (link). If they are thinking within the everyday frame of personal life and leisure, their actions are as honest as anyone else’s. But if they are prompted to think within the frame of their professional environment, their actions become substantially less honest. That professional environment is the large international bank.… 
This is a striking set of findings for a number of reasons. First, it strongly suggests that there are strong markers and incentives within the social environment of the bank that lead its employees to behave in dishonest ways. There is something about working in and around a financial institution that appears to provoke dishonesty. This sounds like a "culture of workplace" kind of effect. It suggests perhaps that bankers are acculturated over an extended period of experience to possess traits of character and behavior that lead them to behave dishonestly.

But second, the data seem to refute the "culture and character" interpretation. The same set of experiments supports the finding that when these same individuals approach the coin-tossing task with a mental framework oriented towards everyday personal life, their choices revert to the generally honest behavior of the broader population. In other words, these findings do not support the idea that banking either recruits or creates dishonest people. Rather, the findings seem to imply that banking encourages dishonestbehavior within the specific framework of banking business and only while the workplace signals are salient.
Bill Black calls it a criminogenic environment. It's actually well known that institutional culture is highly influential on individual behavior, and that the culture is established by the leadership in that subordinate imitate superiors, regardless of whether this takes place intentionally or not. The buck stops in the corner office.

Understanding Society
How professionals think
Daniel Little | Chancellor of the University of Michigan-Dearborn, Professor of Philosophy at UM-Dearborn and Professor of Sociology at UM-Ann Arbor

Phil Stewart — U.S. plans to arm Iraq's Sunni tribesmen with AK-47s, RPGs, mortars

 I thought Kalashnikov products were sanctioned. I guess sanctions don't apply to the US government.

U.S. plans to arm Iraq's Sunni tribesmen with AK-47s, RPGs, mortars
Phil Stewart

Vladimir Kozin — Why is Russia going to skip the Nuclear Security Summit in the US?

Reports and commentary periodically appear on this subject in the American media that only note Russia’s refusal to participate in the 2016 summit, without citing her motives or reasons, which is nothing more than a futile attempt to put pressure on the Russians, as well as a desire to expose her “unconstructive” approach to this problem and thus force some change in it. 
But it is important to highlight something truly fundamental here: Russia is not dismissing the need to examine and discuss this urgent and vital issue of international magnitude. Indeed, the motives behind Moscow’s refusal have an entirely different origin. 
The Russian Foreign Ministry explained that its aversion to taking part in the preparations for the fourth summit, to be held in the US, has nothing to do with the Ukrainian crisis or even some other circumstances unrelated to this forum, but rather stems from the following:
Summary: The US is stacking the deck in its favor.

Oriental Review
Why is Russia going to skip the Nuclear Security Summit in the US?
Vladimir Kozin

circuit — It's baaack: Paul's Japan paper (monetary policy and expectations in an era of low inflation) (trying not to be monkish)

One of the ongoing debates in economic policy these days is the question of whether a central bank alone can be effective at getting an economy out of the doldrums. 
The most famous exposition of the idea that a central bank alone has the ability to boost economic activity is Paul Krugman's paper entitled "It's baaack: Japan's Slump and the Return of the Liquidity Trap" (1998). 
In the paper, Prof. Krugman explains that, in a (hypothetical) world of Ricardian equivalence in which fiscal policy has no effect on the real economy, the central bank can get households and firms to borrow and spend by announcing it will bring about higher inflation in the future.

Prof. Krugman knows that the assumption of Ricardian equivalence is far fetched and unrealistic; he only includes this simplifying and unrealistic assumption to make his point that the central bank alone can stimulate the economy when fiscal policy is unavailable as a policy option (due to policymakers ideological aversion to public spending, the presence of high public debt, etc.).
Now before I go any further I want to say that I'm a huge fan of Paul Krugman. I think he's one of  the most sensible economic commentators out there and I agree with almost all his views on policy. On the effectiveness of central banks alone to boost economic activity, however, I'm quite skeptical. 
The logic in Prof. Krugman's paper can be summarized as follows:
Fictional Reserve Barking
It's baaack: Paul's Japan paper (monetary policy and expectations in an era of low inflation) (trying not to be monkish)

Merijn Knibbe — Dear Deirdre, Distributional Issues Do Matter. Always. And everywhere.

Deirdre McCloskey has written a lengthy Piketty criticism – and she totally agrees with Piketty. It’s Friedmanian in spirit: a self-concious, eloquent (even more eloquent than Friedman!) defense of the market based upon clever arguments and our experience with markets, though also more literate and less US centered than the typical Friedman piece. But it’s a somewhat weird piece. She states that she totally disagrees with Piketty. But she doesn’t. In fact she totally shares his vision: it’s all about g. She defines ‘g’ as ‘The great enrichment’. And states, just like Piketty, that g, or the high growth rate of our economy, saved us from becoming a rentier economy. And just like Piketty she does not seem to understand balance sheets. More on that below.
Real-World Economics Review Blog
Dear Deirdre, Distributional Issues Do Matter. Always. And everywhere.
Merijn Knibbe

John Gray — A Point of View: The writer who foresaw the rise of the totalitarian state

The 19th Century Russian novelist Fyodor Dostoyevsky wrote about characters who justified murder in the name of their ideological beliefs. For this reason, John Gray argues, he's remained relevant ever since, through the rise of the totalitarian states of the 20th Century, to the "war against terror".
When liberalism becomes illiberalism.

BBC News Magazine
A Point of View: The writer who foresaw the rise of the totalitarian state
John Gray

Saturday, November 22, 2014

David Glasner — Misunderstanding Reserve Currencies and the Gold Standard

In Friday’s Wall Street Journal, Lewis Lehrman and John Mueller argue for replacing the dollar as the world’s reserve currency with gold. I don’t know Lewis Lehrman, but almost 30 years ago, when I was writing my book Free Banking and Monetary Reform, which opposed restoring the gold standard, I received financial support from the Lehrman Institute where I gave a series of seminars discussing several chapters of my book. A couple of those seminars were attended by John Mueller, who was then a staffer for Congressman Jack Kemp. But despite my friendly feelings for Lehrman and Mueller, I am afraid that they badly misunderstand how the gold standard worked and what went wrong with the gold standard in the 1920s. Not surprisingly, that misunderstanding carries over into their comments on current monetary arrangements.
Uneasy Money
David Glasner | Economist at the Federal Trade Commission

Dr. Housing Bubble — The middle class migration out of California

People look at population growth in California and see nothing that stands out. Digging into the numbers you find some interesting figures. First, the main reason California is actually growing is because of international migration. California for well over a decade is losing domestic residents. That is, “domestic” Californians on a net basis are heading out of the state. On a more micro level, you are seeing the middle class either being phased out of the state or being pushed into lower priced inland regions. It is an interesting trend that is also happening in the tech hungry Bay Area. Housing continues to be an important topic because the vast majority of income is spent on housing. California has one of the highest percentage of families spending half or more of their monthly income on either rent or housing payments. In places like Los Angeles the main international migration is coming from Asia. You also see this driving up real estate values in certain areas and this contributes to domestic out migration. The migration numbers are interesting and shed light on this global trend.
Dr. Housing Bubble
The middle class migration out of California: While domestic migration is up, foreign migration is filling the gap.

RT — ‘We will hunt you down’: KKK threatens to shoot Anonymous ‘n***** lovers’

Getting ugly out there.

‘We will hunt you down’: KKK threatens to shoot Anonymous ‘n***** lovers’

Anonymous: KKK members may have infiltrated Ferguson cop support group

BBC News — Ukraine crisis: Lavrov warns over Russia 'regime change' goal

Western sanctions against Russia over its role in Ukraine are aimed at forcing regime change in Moscow, Foreign Minister Sergei Lavrov says. 
Speaking to foreign policy advisers in Moscow, Mr Lavrov referred to calls for sanctions "that will destroy the economy and cause public protests". 
On Thursday, President Vladimir Putin said Moscow must guard against a "colour revolution".
BBC News
Ukraine crisis: Lavrov warns over Russia 'regime change' goal


Lavrov accuses West of seeking 'regime change' in Russia
Polina Devitt

China cannot afford to let regime change happen in Russia and won't.

Russia knows this.

Vineyard of the Saker
Observations on President Putin’s call upon US not to meddle in Russia affairs
Peter Koenig

The History of a Dangerous Idea: Mark Blyth Talks Austerity, Greece and the Global Economic Crisis — Michael Nevradakis interviews Mark Blyth

Economist, professor at Brown University and author ofAusterity: The History of a Dangerous Idea, Mark Blyth talks with Truthout about the historical origins of austerity as an economic idea, how previous attempts to enforce austerity policies were catastrophic, and the worldwide economic crisis today.
The History of a Dangerous Idea: Mark Blyth Talks Austerity, Greece and the Global Economic Crisis
Michael Nevradakis, Truthout | Interview — MPs debated money creation and society

Watch the debate and read the transcript 
The debate was opened by Steve Baker at 11.18am. Shadow Treasury Minister, Catherine McKinnell, responded to the debate on behalf of the Opposition. The Economic Secretary to the Treasury, Andrea Leadsom, responded to the debate on behalf of the Government. 
Watch Parliament TV: MPs debate money creation and society, Thursday 20 November 2014 
Read the debate in Hansard. 
Read Commons Hansard: MPs debate money creation and society, Thursday 20 November 2014
MPs debated money creation and society


Background and prognosis.

The Financial Times — FT Alphaville
Private money vs totally-public money, plus some history
Izabella Kaminska

Pepe Escobar — Washington plays Russian roulette

Bleak assessment.

Asia Times Online — The Roving Eye
Washington plays Russian roulette
Pepe Escobar

Matthew Lynch — 5 Reasons Bilingual Education Should Be Mandatory from Kindergarten On Up

What is your opinion on mandating bilingual education programs?
No brainer. Spanish especially, since it is a very easy language to learn and highly useful in the Western Hemisphere.

I would go further have introduce a program in language skills where children from pre-K learn the basics of language by imitating the sounds of a variety of languages, especially those that are likely to be useful later in life.

And, yes, I am thinking in particular of Chinese, which is a difficult language to learn because meaning depends on tonal difference of the same syllable. This is relatively simple for young children to pick up and very difficult to master later in life. Obviously, Chinese is going to be increasingly important as this century progresses.

If a person learns a second language very young and also how to pronounce the sounds of different languages, language learning is relatively simple.

Lynch lists five reasons for this but there are many more. In fact, speaking more than one language even reduces one's chances of dementia.

5 Reasons Bilingual Education Should Be Mandatory from Kindergarten On Up
Matthew Lynch, Ed.D. | editor of The Edvocate,

Friday, November 21, 2014

Tyler Cowen — Deirdre McCloskey has a 55-page review essay on Piketty

Download link at his place.

Marginal Revolution
Deirdre McCloskey has a 55-page review essay on Piketty
Tyler Cowen | Holbert C. Harris Chair of Economics at George Mason University and serves as chairman and general director of the Mercatus Center

Andy Peters — Morning Scan: Fed Wonders if It's 'Captured'; Commodity Holdings Questioned

The Fed established a team in Washington to review whether it's too cozy with the banks it regulates. The New York Timesdescribed the review as a "surprise announcement." The Fed's inspector general will simultaneously conduct a similar review, looking specifically at whether "top officials were hearing all the opinions of Fed bank examiners." The moves were announced Thursday, ahead of Fed Governor Daniel Tarullo's and New York Fed President William Dudley's testimony on Friday before a Senate committee. Dudley is expected to be questioned aggressively about whether the Fed is guilty of "regulatory capture." Among the areas to be studied in the Fed's internal review is whether board members are supplied with adequate information to make sound oversight decisions. Lawmakers will have plenty of ammunition to level charges that the Fed has been captured, from the secret recordings of Fed conversations about Goldman Sachs, to the recent revelation that a Goldman employee received confidential information from a Fed worker about a bank the Fed regulates.
American Banker
Morning Scan: Fed Wonders if It's 'Captured'; Commodity Holdings Questioned
Andy Peters

Jeffrey Sachs — China’s New Global Leadership

Jeff Sachs gets this about right. Now if he would just get his economics right.

Project Syndicate
China’s New Global Leadership
Jeffrey D. Sachs | Professor of Sustainable Development, Professor of Health Policy and Management, and Director of the Earth Institute at Columbia University, is also Special Adviser to the United Nations Secretary-General on the Millennium Development Goals

Randy Wray — Founder of PayPal Says Taxes Drive Money

 Peter Thiel been reading Warren Mosler?

Great Leap Forward
Founder of PayPal Says Taxes Drive MoneyL. Randall Wray | Professor of Economics, University of Missouri at Kansas City

Michigan Citizen — Court rules Michigan has no responsibility to provide quality public education

In a blow to schoolchildren statewide, the Michigan Court of Appeals ruled on Nov. 7 the State of Michigan has no legal obligation to provide a quality public education to students in the struggling Highland Park School District.
A 2-1 decision reversed an earlier circuit court ruling that there is a “broad compelling state interest in the provision of an education to all children.” The appellate court said the state has no constitutional requirement to ensure schoolchildren actually learn fundamental skills such as reading — but rather is obligated only to establish and finance a public education system, regardless of quality. Waving off decades of historic judicial impact on educational reform, the majority opinion also contends that “judges are not equipped to decide educational policy.”…
The decision dismisses an unprecedented “right-to-read” lawsuit filed by the ACLU of Michigan in July 2012 on behalf of eight students of nearly 1,000 children attending K-12 public schools in Highland Park, Mich. The suit, which named as defendants the State of Michigan, its agencies charged with overseeing public education and the Highland Park School District, maintained that the state failed to take effective steps to ensure that students are reading at grade level.

“Let’s remember it was the state that turned the entire district over to a for-profit charter management company with no track record of success with low performing schools,” said Moss. “It is the state that has not enforced the law that requires literacy intervention to children not reading at grade level. It is the state’s responsibility to ensure and maintain a system of education that serves all children.”
Michigan Citizen
Court rules Michigan has no responsibility to provide quality public education
The Michigan Citizen
h/t Clonal

David Ellerman — Double-entry Bookkeeping: The Mathematical Treatment

Double-entry bookkeeping (DEB) implicitly uses a specific mathematical construction, the group of differences using pairs of unsigned numbers (“T-accounts”). That construction was only formulated abstractly in mathematics in the 19th century—even though DEB had been used in the business world for over five centuries. Yet the connection between DEB and the group of differences (here called the “Pacioli group”) is still largely unknown both in mathematics and accounting. The precise mathematical treatment of DEB allows clarity on certain conceptual questions and it immediately yields the generalization of the double-entry method to multi-dimensional vectors typically representing the different types of property involved in an enterprise or household. 
This publication represents success in a long struggle, stretching over three decades, to get the mathematical treatment of double-entry bookkeeping published in an accounting journal. Although the mathematical treatment and generalization of DEB was previously published in book form and in math and operations research journals, it seems to have been repeated blocked by the repeated refereeing of the author of the failed previous attempt at multi-dimensional DEB (see p. 493 in the paper). 
Click here to download the reprint.
David Ellerman
Double-entry Bookkeeping: The Mathematical Treatment

RT — New Tax Law to Reverse Capital Outflows, Bring Billions to Russian Treasury

The new law requiring that all foreign dealings now be reported, aims to prevent major capital outflow (estimated at $200 billion in 2014)….

Russia’s upper house of parliament has approved an “anti-offshore” law requiring individual and corporate taxpayers to report foreign profits. The Russian government aims to prevent capital outflow via “offshores,” estimated at $200 billion in 2014.
The law requires Russian tax authorities to be notified of all foreign dealings. The government believes it will return $3.1-4.2 billion in tax revenue to the Russian state budget.…
According to some experts, over $2 trillion has flowed offshore out of Russian jurisdiction in recent years, TASS reports. Even the most moderate estimates put the figure at between $800 million and $1 trillion.…
Legislators believe that 20-30 percent of capital outflow can return to the country via taxes.

Offshore companies are used to blanket the activities of companies that wish to keep ownership details anonymous or as an outlet for criminal activities such as tax evasion and corruption.…
Russia’s largest car-maker, AvtoVaz announced in May that it will drop its offshore status and re-register in Russia. Many of Russia’s biggest state companies- Rusal, Evraz, Russian Railways, and Metalloinvest generate a lion’s share of their profits outside of Russia.