In a way, these woke generations are paraphrasing Samuel Huntington, who writing in his Clash of Civilizations, asserted that “the concept of a universal civilization helps justify Western cultural dominance of other societies and the need for those societies to ape Western practices and institutions.” Universalism is the ideology of the West for confronting other cultures. Naturally, everyone outside the West, Huntington argued, should see the idea of one world as a threat.There are two sides (at least) in a dialectical argument. I am not taking either side, and personally am happy to see the "conversation" taking place not only intellectually but also in history. I also think that is a transformational process that will extend over perhaps hundreds of years.
Huawei has dramatically ramped up investment in Russia due to US restrictions against the tech giant, CEO Ren Zhengfei has said.
“After the United States included us in the Entity List, we transferred our investment in the United States to Russia, increased Russian investment, expanded the Russian scientist team, and increased the salary of Russian scientists,” Ren said in a recent speech to Chinese universities, his comments cited by Shanghai Jiao Tong University on Sunday....Sputnik International
In sum, lockdown has been positive for knowledge worker productivity in the short term. But it has also created some concerns and challenges around longer-term effectiveness, creativity, and personal resilience. Let’s consider the findings from the research in more depth, then discuss what the opportunities and challenges are for the months and years ahead....Harvard Business Review
Regular readers will know that for the last few years I have been documenting the way that the dominant paradigm in macroeconomics (New Keynesianism) is slowly disintegrating as the dissonance between its empirical predictions and reality becomes too great to ignore and justify. The once-in-a-century pandemic hasn’t given us much to celebrate in 2020. One cause for optimism, perhaps, is that we might finally jettison the mainstream economics fictions about government deficits and debt, which have hampered prosperity over several decades. Last week (August 27, 2020), the US Federal Reserve Bank Chairman, Jerome Powell made a path breaking speech – New Economic Challenges and the Fed’s Monetary Policy Review – at the annual economic policy symposium sponsored by the Federal Reserve Bank of Kansas City at Jackson Hole. On the same day, the Federal Reserve Bank released a statement – Federal Open Market Committee announces approval of updates to its Statement on Longer-Run Goals and Monetary Policy Strategy. We have now entered a new phase of the paradigm shift in macroeconomics.Winning.
The Monetary Monopoly Model (Section 4.3) is a core model of Modern Monetary Theory. If we take it literally, we do not need a theory of inflation, since the price level in some variants of the model is explicitly set as a policy variable. However, reality is far more complex than the model suggests, and if we want to match theory to reality, we are faced with the realisation that governments act in a fashion that sabotages the control of the price level that they do have.
(Note: This is an unedited draft of a section of my increasingly long MMT primer.)Bond Economics
A propos our recent discussion of whether MMT is a theory, a dogma, or a description.
I’ve always been baffled why ‘modern monetary theory’ is called a theory. I don’t mean this in a disparaging way. As far as theories of money go, I think modern monetary theory (MMT for short) is the correct one. But having a correct theory of money is a bit like having a correct theory of traffic lights.
Understanding this act of money creation is trivial — much like understanding the creation of a traffic light. Just like we define the rules of traffic, we define the rules of double-entry bookkeeping. We then use these rules to regulate our behavior, creating money as we please.
What’s interesting, though, is that few people misunderstand traffic lights. We all know that traffic lights can be put anywhere we want them, and that they’re based on an arbitrary social convention. Yet when it comes to money, the same is not true. Many people fundamentally misunderstand money. To them, it’s not an arbitrary social convention that can be created/destroyed at will. Instead, they perceive money as a scarce commodity — something that, like water in a desert, must be guarded and conserved.
What we really need, then, is not so much a theory of money, but a theory of why people misunderstand money.
Economics from the Top Down -- Why Isn’t Modern Monetary Theory Common Knowledge?
Blair Fix -- Political economist. Blogger. Muckraker. Foe of neoclassical economics.
Plans for a TikTok sale may have a new obstacle, with China implementing new rules on AI technology exports, The New York Timesreported. The new export control rules, which focus on technology the Chinese government considers sensitive, could mean that TikTok’s parent company, Beijing-based ByteDance, might need a license before it can sell TikTok to an American company.
The updated regulations prohibit exporting technology including text analysis, voice recognition, and content suggestions without a license from the Chinese government. According to The Wall Street Journal, a Chinese government official told state-run Xinhua News Agency that ByteDance should “seriously and cautiously” consider halting talks for a sale of TikTok.…The plot thickens.
A socialist government such as China’s can keep its industry going simply by simply writing down debts when they can’t be paid without forcing a closedown and bankruptcy and loss of assets and employment. The world thus has two options: a basically productive public financial system in China, or a predatory financial system in the United States....Incidentally, I searched on the title in Google search to see whether this site is being deplatformed and came up with nothing. The Unz Review is apparently being censored.
But there has been an issue: Steve did not 'get' MMT and its argument that spending creates the money to pay tax and fund what is called government borrowing, but which is actually the redepositing of the excess of government spending over taxes raised back with the government for safekeeping. And that obstacle meant that we could never quite agree.
And then he read The Deficit Myth by Stephanie Kelton, which is also essential reading. And he did some double-entry book-keeping to build a Minsky inspired model of the economy, which is available to sponsors of his blog. And the result is that he now gets that what Stephanie says, and what I've been saying for some time, is right: i.e. that the deficit creates money.
Money is not needed to fund the deficit. The deficit makes the money to pay for itself.The bonds just tidy up the private sector, and bank, balance sheets and let it be pretended that the government is not lending itself money when that is what it actually, and inevitably, is doing via its own central bank...Amazing that it took reading The Deficit Myth for Steve to realize this elementary institutional fact.
As the Democratic Convention is in progress, it is fitting to look at how Democrats in Congress and the White House, with Republican collaboration, were responsible for the Magnitsky Act, the law that protects tax fraudster William Browder and his henchman Mikhail Khodorkovsky by erecting a wall against their having to face justice for their financial crimes. And ramps up hostility to Russia....Documented.
“We are building up our forces to ensure the economic development of the region,” the Ministry of Defense statement said...."Freedom of navigation" works both ways.
The two books I tell people to read to understand not just the United States’ war in Vietnam, but also its wars in Iraq and Afghanistan, as well as the current world war the US has created and sustained that stretches from western Africa to Pakistan, are David Halberstam’s The Best and the Brightest and Neil Sheehan’s A Bright Shining Lie. Both men were New York Times reporters, with extensive experience in Vietnam, and both men reported not only critically on the war, but adversarially, something that any observer of major American media of the last twenty years will note is often missing in US media coverage of the current wars in the Muslim world.* What few examples we have in corporate media these last two decades of critical and adversarial reporting on the wars is fickle and frail when compared to the strength, integrity and depth of reporting and writing produced by Halberstam and Sheehan. Read these two books about the lies, the self-deceptions, the careerism, the group-think, the chauvinism, and the greed of the American Empire and its officers, and you will understand not just the American war in Vietnam, but the wars of this century, wars that continue to devastate and destroy so many.**
I read those two books when I was a junior officer in the Marine Corps in the late 1990s, not because I had some critical perception of the US military or possessed a rebellious intellect, but because those books, at the time, were required reading for Marine officers. So were the works of Mao, Che Gueverra, Bernard Fall, Alistair Horne, Alan Moorehead, Harry Summers and Sun Tzu; and not just one, but two books about General Giap, the Vietnamese military commander who defeated both the French and the US, appeared on the 1998 list, including Giap’s own work, How We Won the War. The commandant of the Marine Corps, James Jones, who became Barack Obama’s national security adviser and then cheer-led for and oversaw the escalation of the Afghan War in 2009, in a message to all Marines in 2000, said A Bright Shining Lie was one of his top 5 most important books. He said that before he had the choice of ...I read most of the books on this list that were published at time when I was a US Naval Reserve officer on active duty in the Pacific fleet. For example, Bernard Fall wrote about the French experience in Vietnam that led to their ignominious defeat by a tenacious and clever indigenous people improvising guerrilla tactics suitable for conditions there.
Why, in the world’s richest country, is every metric of mental health pathology rapidly worsening?The Intercept
There are lots of people who would lose their well paid jobs if peace were ever to break out. Posh houses, fancy cars, the best restaurants, status: these people would sooner risk WW3 than lose any of those things.
“Now, just like during the Cold War, fighting Russia on all fronts, including information and propaganda, has become the alliance’s reason for existence,” he explained. “NATO has deployed extensive resources on the eastern flank, near our borders, including conducting exercises and improving military infrastructure.”
During the news conference, the spokesman also referred to a survey, conducted by the Chinese social media platform Weibo, which indicated that about 95 percent of respondents were ready to give up the use of their iPhones if WeChat was blacklisted by the US.Tim Cook has warned the president that banning American support of WeChat would end Apple in China , which would drop Apple device sales 30%.
We have seen how China is meticulously planning all its crucial geopolitical and geoeconomic moves all the way to 2030 and beyond.
What you are about to read next comes from a series of private, multilateral discussions among intel analysts, and may helpfully sketch the big picture.…
Those, like environmental lawyer Steven Donziger, who fight the corporate control of our society on behalf of the vulnerable find the institutions of power unite to crucify them.Ambassador Craig Murray is similarly on trial for contempt of court.
George Monbiot has been writing in a similar vein:The Book of Trespass, by Nick Hayes, is massively researched but lightly delivered, a remarkable and truly radical work, loaded with resonant truths and stunningly illustrated by the author.
"Primitive accumulation."It shows how the great estates, from which we are excluded, were created by a combination of theft from the people of Britain (the enclosure of our commons) and theft from the people of other nations, as profits from the slave trade, colonial looting and much of the £30tn bled from India were invested into grand houses and miles of wall: blood money translated into neoclassical architecture.
The US has gone as far as to claim that the listed institutions are working on chemical and biological weapons.…
Russian Health Minister Mikhail Murashko stated that all the foreign criticism was provoked by the fear of fair competition and slammed the accusations as unfounded.National security or anti-competitive?
Miller concludes, “The best way to get astronomically rich in America is to acquire monopoly power to extract wealth from workers, consumers, entrepreneurs, small businesses, and, through tax breaks, subsidies, and contracts, our government itself. Monopolies are powerful generators of the inequality that progressives decry.”The chief weakness of capitalism under bourgeois liberalism is government capture, e. g., through legalized bribery (lobbying and campaign finance) and the revolving door. The ultimate reason that republics are subject to capture by special interests is class power. This version of oligarchy is the liberal side of feudal aristocracy resulting from the 18th century Enlightenment out of which bourgeois liberalism grew.
The previous post finished with the observation that, since the sum of all Equity is zero, and the banking sector must be in positive equity, part of the remainder of the economy - the government, or the non-bank public - must be in negative equity. So which sector is better equipped to handle that: the non-bank public, or the government?…
In the next post, I'll consider what the impact is of different fiscal regimes: the government running a deficit (as the USA has for most of the last 120 years - roughly of 2.5% of GDP); the government running a surplus; the government running a surplus and the private sector borrowing from the Banking Sector; the government running a surplus and the private sector reducing its debt to the Banking Sector; and the government running a deficit while the private sector reduces its debt to the Banking Sector.
Recent economic research establishes that the United States suffers from a growing market power problem. Market power, often referred to as monopoly power, means consumers pay more for the goods and services they need. Workers earn less. Small businesses have a harder time succeeding. Innovation slows. Market power exacerbates wealth inequality, too, because those who benefit from monopolies—the high-paid executives and stockholders of corporations—are wealthier, on average, than the consumers, workers, and small businesses who bear monopolies’ costs.
U.S. antitrust laws, as interpreted and enforced today, are inadequate to confront and deter growing market power in the U.S. economy. To restore a fair and competitive market, we need legislation that strengthens the law and counters growing corporate power, enforcers who are willing to aggressively enforce laws, and increased fiscal resources to enforce the law.Workers getting paid less and consumers paying more than they would in a symmetrical market as a result of market power is rent extraction, in this case, monopoly-monopsony rent. The genuine economic meaning of "free market" is symmetrical market, aka perfect market. That is to say, in perfect markets having no asymmetry, prices reflect costs vertically and horizontally, and there is no opportunity to extract economic rent.
One is reminded of the Japanese book and movie Rashomon. The story was written by Akutagawa Ryunosuke in 1922 and the film, directed by Akira Kurosawa, followed in 1950. The tale, set in 8th Century feudal Japan, involved a rape and a murder with each of the four principal characters providing his and her own version of what had occurred. The murdered samurai speaks through a Shinto psychic, while a bandit-witness in the forest, a traveling monk, and the samurai’s wife, who was the rape victim, all provide alternative versions of what had taken place. The story reveals how all of the contradictory testimony was fundamentally dishonest, in that each participant was interpreting events to support his or her self-interest in the outcome of the tragedy.Obvious maybe, but someone needed to say it and draw the parallels.
By registering the world's first anti-coronavirus vaccine, Russia has confirmed its scientific superpower status, says Dr. Heinz Dieterich, coordinator at the World Advanced Research Project (WARP), explaining why Sputnik V is a worthy competitor to any of Big Pharma's new COVID vaccine candidates.(In case you were wondering, "sputnik" means satellite. Sputnik I (4 October 1957) was the first satellite to be launched into orbit, beginning the space race.
Answering questions from Senator Lindsey Graham, Secretary of State Pompeo confirmed that the State Department had awarded an American company, Delta Crescent Energy, with a contract to begin extracting oil in northeast Syria. The area is nominally controlled by the Kurds, yet their military force, the Syrian Democratic Forces (SDF), was formed under U.S. auspices and relies on an American military presence to secure its territory. That military presence will now be charged with protecting an American firm from the government of the country that it is operating within.
Pompeo confirmed that the plans for implanting the firm into the U.S.-held territory are “now in implementation” and that they could potentially be “very powerful.” This is quite a momentous event given its nature as a blatant example of neocolonial extraction, or, as Stephen Kinzer puts it writing for the Boston Globe, “This is a vivid throwback to earlier imperial eras, when conquerors felt free to loot the resources of any territory they could capture and subdue.”
Indeed, the history of how the U.S. came to be in a position to “capture and subdue” these resources is a sordid, yet informative tale that by itself arguably even rivals other such colonial adventures.Neo-imperialism no longer. Now naked imperialism.
Similar to a policy rate, YCC aims to control interest rates along some portion of the yield curve. The yield curve is usually defined as the range of yields on Treasury securities from three-month Treasury bills to 30-year Treasury bonds. However, YCC targets longer-term rates directly by imposing interest rate caps on particular maturities. Because bond prices and yields are inversely related, this also implies a price floor for targeted maturities. If bond prices (yields) of targeted maturities remain above (below) the floor, the central bank does nothing. However, if prices fall (rise) below (above) the floor, the central bank buys targeted-maturity bonds—increasing the demand and thus the price of those bonds.
The minutes of the FOMC meeting on June 9-10 noted that the staff highlighted three examples of YCC policies: Federal Reserve policy during and after World War II, the Bank of Japan’s policy adopted in 2016 and the Reserve Bank of Australia’s policy adopted in March 2020.FRBSL — On the Economy Blog
This textbook demonstrates how misleading it can be to apply oversimplified models of perfect competition to the real world. The math works well on college blackboards but not so well on the Main Streets of America. This volume explores the realities of oligopolies, the real impact of the minimum wage, the double-edged sword of free trade, and other ways in which powerful institutions cause distortions in the mainstream models. Bringing together the work of key scholars, such as Kahneman, Minsky, and Schumpeter, this book demonstrates how we should take into account the inefficiencies that arise due to asymmetric information, mental biases, unequal distribution of wealth and power, and the manipulation of demand. This textbook offers students a valuable introductory text with insights into the workings of real markets not just imaginary ones formulated by blackboard economists.Amen.
One of the standard criticisms raised by many neoclassical economists is that there is nothing new to MMT. Given that neoclassical economists and MMT proponents have been arguing loudly online for over a decade, it seems hard to support the view that MMT is a subset of neoclassical economics. (Another weak point in the argument is that the person making it rarely has read any MMT academic work, so the critic is not exactly sure what features are part of neoclassical economics.)
A slightly less adversarial stance taken is that MMT insights can be replicated by adapting neoclassical methods. I think the answer to that question is: yes and no. Although it seems possible to get parallel results to parts of “narrow MMT,” but the integration with broad MMT does not appear to be possible. This is more plausible, and the subject of discussion here.
(Note: This is an unedited draft section of my MMT primer. It is part of a chapter discussing common critiques of MMT.)Bond Economics
In his role as Secretary-General of the Global Sharing Economy Alliance, Ge gave a presentation entitled "The Great Sharing Economy Gives Birth to Unicorns". He pointed out that traditional sharing economy models that share small property rights on commodities such as cars, bicycles, and home rentals is transitioning to a model where larger business assets such as capital, production capacity, and intellectual property rights are made available for sharing.TASS
At last week’s National Cabinet meeting (August 21, 2020), the governor of the Reserve Bank of Australia continued to play a political role in the economic debate despite hiding behind the veil of ‘independence’ from such matters. A few weeks ago, the federal government claimed the state and territory governments were not doing enough by way of fiscal stimulus to reduce the job losses associated with the pandemic. The Federal government is essentially trying to force the political consequences of its own failure to increase its net spending by enough and the resulting real economic damage that has resulted onto the states and territories. The RBA governor seems to be playing along with this agenda. Last Friday, he called for the states and territories to double their fiscal stimulus outlays (by $A40 billion) and stop fussing about credit ratings. The problem is that if they did that, the conservatives would immediately start claiming the debt was unsustainable and would damage the states’ credit ratings. Just as they regularly do to advance their political agendas to cut the size of state governments. While the mainstream economists urge ‘fiscal decentralisation’ they do so because they know states are not currency issuers and will then be open to attacks about tax burdens etc, which then bias the political debate towards cutting services etc. In general, the spending responsibilities should be at the level of the currency-issuer. And, the RBA governor should get back to fulfilling the legal charter of the RBA – to ensure there is full employment and price stability. His institution is achieving neither – with negative inflation and massive labour underutilisation. If he really wanted to increase job creation he could signal that the RBA would purchase any debt issued by governments at all levels who announced, and, made operational, large scale job creation programs. That would work....Bill Mitchell – billy blog
The Covid-19 pandemic has added severe financial strain on a North American upstream industry that was already reeling under billions of dollars of debt. With WTI climbing past $40 a barrel, most exploration and production firms (E&Ps) have been able to keep their head above water, but unless prices strengthen further about 150 more E&Ps will need to seek Chapter 11 protection through 2022, a Rystad Energy analysis shows. So far this year, according to Haynes & Boone, 32 E&Ps have already filed for Chapter 11, recording a cumulative debt of about $40 billion. On the oilfield services (OFS) front, 25 companies have filed for Chapter 11. If WTI remains at $40, Rystad Energy estimates 29 more E&P Chapter 11 filings this year, adding another $26 billion of debt at risk.
In a scenario with WTI continuing to hover around $40 over the next two years, we can expect another 68 Chapter 11 filings from E&Ps in 2021, and 57 more in 2022, adding $58 billion and $44 billion, respectively, of more debt at risk. That would bring the total amount of E&P debt at risk from now until the end of 2022 to $128 billion....
Bill Mitchell – billy blogThis is the third part in my historical excursion tracing where progressive forces adopted the idea that it was fair and reasonable for individuals who sought income support from the state to contribute to the collective well-being through work if they could. As I noted in Part 1, the series could have easily been sub-titled: How the middle-class Left abandoned the class fundamentals, became obsessed with individualism, and steadily descended into political obscurity, so much so, that the parties they now dominate, are largely unelectable! Somewhere along the way in history, elements of the Left have departed from the collective vision that bound social classes with different interests and education levels into a ‘working class’ force. In this Part, we disabuse readers of the notion that the ‘duty to work’ concept was somehow an artifact of authoritarian regimes like the USSR. In fact, we find well articulated statements in official documents in most Western democracies.
The earlier parts in this series are:
1. Tracing the roots of progressive views on the duty to work – Part 1 (August 4, 2020).
2. Tracing the roots of progressive views on the duty to work – Part 2 (August 11, 2020).
Wuhan is what happens when a central gov act decisively to crush COVID19: whole city lockdown, hospital build in 7 days, 11 million tested, life returns to normal aft 3 month
This could be you had your gov acted effectively
