Monday, October 25, 2021

Why Everyone Is Wrong About Biden’s $600 Billion Climate Bill — Leonard Hyman & William Tilles

  • It looks like Senator Joe Manchin will stand firm in his stance against the climate change provisions in Biden’s infrastructure bill
  • When it comes to the climate bill it looks like there are no winners here, with both Manchin and Biden failing to secure anything concrete from negotiations
  • Ultimately, the bill is unlikely to have a significant impact on a transition that is clearly underway already within the United States
Why Everyone Is Wrong About Biden’s $600 Billion Climate Bill
Leonard Hyman & William Tilles

Sputnik — US Urges Germany to Consider Sanctioning Russia Over Gas Supplies

Risible. Who is holding the stronger hand?

Sputnik International
US Urges Germany to Consider Sanctioning Russia Over Gas Supplies

Reading The Classics: Mathematics Vs. Economics — Brian Romanchuk

There’s been a fun (but silly) long-running debate on Twitter whether economists need to read canonical texts: Smith, Marx, Ricardo, Keynes, etc. What caught my eye is that a mainstream economist compared economics to mathematics — why don’t we learn calculus by studying the history of calculus? Why this is interesting is that is showed a lack of understanding of the situation in both mathematics and economics.

Please note that this article is a discussion of the philosophy of teaching at the university level, so do not expect any conclusions that will help make analysing bond markets easier. That said, there is an outline of a critique of the core methodological principles of neoclassical macro.

I will first start with mathematics....
As an aside, having spent a good deal of time as an educator, I think that teaching the history of all subjects is worthwhile, both individually and as a whole in terms of major periods. This should begin in grammar school when the study of history is introduced.

First, it makes a subject more interesting for students being introduced to a subject. Secondly, and it also shows the important of the heritage of knowledge upon which civilization is built. Thirdly, studying the history of the development of knowledge also reveals how social reproduction through culture in contrast to individual reproduction along with other animals makes humanity exceptional. Finally, it shows how different aspects of knowledge interacted with each other historically in a single complex adaptive system to contribute to this phenomenon involving not only human development but ecology. And it does a lot more.

Bond Economics
Reading The Classics: Mathematics Vs. Economics
Brian Romanchuk

On the role of economics and global inequality — Branko Milanovic

Important for thinking about economics and its relation to the world.

Global Inequality
On the role of economics and global inequality
Branko Milanovic | Visiting Presidential Professor at City University of New York Graduate Center and senior scholar at the Stone Center on Socio-economic Inequality, senior scholar at the Luxembourg Income Study (LIS), and formerly lead economist in the World Bank's research department and senior associate at Carnegie Endowment for International Peace
It takes a while for the mainstream organisations in economics, banking and finance to start to realise that the framework they use cannot explain the actual events in the real world, without serious revision. The problem though, is that the overall framework is flawed and the typical ‘response to anomaly’ approach, which changes a few assumptions to get ‘novel results’ is inadequate because it leaves one blind to all the possible policy solutions. The latest example is the Bank of International Settlements paper – Indebted Demand (released October 19, 2021) – which was written by three economists from Princeton, Harvard and Chicago Booth, respectively. They now recognise that rising inequality and massive household debt is a major problem for economic growth and macroeconomic stability. But, in maintaining ‘conventional’ assumptions about the government sector, they miss the vital linkages in the story, that Modern Monetary Theory (MMT) economists have been providing for the last 25 or so years. Whether these responses to anomaly represent progress or different variations in a flawed ‘chess’ strategy is a matter of opinion. My thought is they are a largely a waste of time, although marginally, they demonstrate that elements of mainstream macro theory that were considered core elements a decade ago are no longer sustainable....
Bill Mitchell – billy blog
When ‘new’ is really old and doesn’t get us very far – latest BIS paper
Bill Mitchl | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australiael

The Tight Fist of Special Interests — Michael Hudson

Transcript of Paul Jay interview.

Michael Hudson — On Finance, Real Estate And The Powers Of Neoliberalism
The Tight Fist of Special Interests
Michael Hudson | President of The Institute for the Study of Long-Term Economic Trends (ISLET), a Wall Street Financial Analyst, Distinguished Research Professor of Economics at the University of Missouri, Kansas City, and Guest Professor at Peking University

Sunday, October 24, 2021

This Shows Why The Yuan Is Defying Economic Slowdown — Ye Xie

In the face of moderating growth, China's leadership has a handle on the RE crisis and both exports and foreign purchase of Chinese stocks and bonds. 

Zero Hedge
This Shows Why The Yuan Is Defying Economic Slowdown
Ye Xie, Bloomberg markets live commentator and analyst

Also at ZH

You can disregard ZH's commentary. They think that today's economies are replicating Seventies stagflation. Completely different conditions. And ZH is on record that the Chinese economy is going to crash. We'll see.

Goldman Cut's China's 2022 GDP To Just 5.2%

The Bright Side of Higher Inflation — Stephanie Kelton

It beats the alternative.
The Lens
The Bright Side of Higher Inflation
Stephanie Kelton | Professor of Public Policy and Economics at Stony Brook University, formerly Democrats' chief economist on the staff of the U.S. Senate Budget Committee, and an economic adviser to the 2016 presidential campaign of Senator Bernie Sanders

Capsian Report - Why China cannot abandon communism

Interesting video! 

Capsian Report seem to be neutral, but I need to find out more about them. I don't know how correct their analysis is, but it seems feasible. 

The world is a pretty dangerous place, with countries still up for grabbing each others resources and wealth, if they can, so China needs to hang into its inner regions, Tibet and Xinglian, etc, as a buffer zone against attack. But these regions are poor, so the richer coastal parts of China have to subsidise them, hence communism still serves China a purpose.  

Southern China can suffer from floods, but the North can suffer from droughts, and both these have caused famines in the past, so the government is spending billions on one of the worlds most ambitious projects, and is building waterways to take some of the water from the South up to the North. But much of the water in the south comes from the rivers that flow from the mountains in Tibet, so China has always insisted that this region is part of its mainland because of its need for water security. 


President Xi Jinping pledged to redistribute wealth while turning up the heat on China’s upscale citizens and businesses. So, what keeps Chinese communism going?

Capsian Report - Why China cannot abandon communism

Does economic growth cause unemployment? — Sandwichman

Usually, a question in the title of an article is a teaser and the answer is almost always "no." Not in this case. The standard argument is that economic growth is necessary to create jobs and that unemployment results from the slowing or interruption of growth.

Even advocates of degrowth or a steady-state economy assume a positive connection between growth and employment. Advocates prescribe reduction of working time as a means to mitigate job losses that would otherwise result from productivity gains.

In chapter 25 of Capital, volume one, however, Marx claimed that the same factors that spur economic growth also stimulate an expansion of the population supplying labour power and the "industrial reserve army." He proclaimed the growth of the surplus population relative to employed labour to be, "the absolute general law of capitalist accumulation."

That, of course, was just an assertion. Defenders of the conventional view argue that Marx either didn't explain a mechanism for his "absolute general law" or if he did it was either wrong or incoherent.

I don't want to pretend expertise on whether Marx's theory stands up to rigorous critique. I sort of suspect every economic theory has a crack in it. That's how the light gets in.

What I want to do instead is suggest that there was a more compact version of Marx's surplus population argument in the Grundrisse that hasn't been refuted because it has mostly gone unnoticed....
Does economic growth cause unemployment?

Comments on Profit and Capital — J. Barkley Rosser

It's complicated. Barkley Rosser unpacks it.

Comments on Profit and Capital
J. Barkley Rosser | Professor of Economics and Business Administration James Madison University

Posts on socially necessary labour time — Sandwichman

This came up in the comment. Here is the link for the record. It is a useful series on the meaning of "socially necessary labour time" relevant to Marx's labor theory of value. The posts are short.

Posts on socially necessary labour time
Sandwichman (Tom Walker)

Sanctioning Yourself in the Foot — Ted Snider

"Sanctions," Iran’s new president, Ebrahim Raisi, told the UN General Assembly, "are the US’s new way of war with the nations of the world." At least nineteen countries are currently besieged by the economic warfare of US sanctions.

As when they wage military war, the US is willing to accept the high civilian cost of sanctions. In their book Why Civil Resistance Works, Erica Chenoweth and Maria Stephan cite studies showing that sanctions "often harm the civilian population more than the targeted regimes." .…
The point of sanctions as economic warfare is to target the adversary government's population with the purpose of instigating an uprising that results in change of government.

But this doesn't work.
Though sanctions do not produce the desired effects, they do, ironically, produce four undesired effects....

The great recoil of neoliberal globalization — Paolo Gerbaudo

The current political era is best understood as a “great recoil” of economic globalization. It is a moment when the coordinates of historical development seem to be inverting, upsetting many of the assumptions that dominated politics and economics over the last decades. This moment corresponds to the “second movement” socialist economic historian Karl Polanyi described in his book The Great Transformation, when phases of capitalist expansion recede and are met by “societal responses.”

According to Polanyi, in phases of profound crisis like that opened by the 1929 Wall Street Crash, society tends to act defensively, erecting forms of social protection against a capitalist logic that has manifestly failed to deliver prosperity, yet becomes even more aggressive in its attempts to extract profit. During this moment, societies are involved in a process of “re-internalization” that aims to “re-embed” the economy in society....
The great recoil of neoliberal globalization
Paolo Gerbaudo

A New Capitalism: The Case for Universal Property — Peter Barnes

Excerpt from Ours: The Case for Universal Property by Peter Barnes

Capitalism as we know it has two egregious flaws: it relentlessly widens inequality and destroys nature. Its ‘invisible hand,’ which is supposed to transform individual self-seeking into widely shared well-being, too often doesn’t, and governments can’t keep up with the conse­quences. For billions of people around the world, the chal­lenge of our era is to repair or replace capitalism before its cumu­­la­tive harms become irreparable.…
Like Marx said would happen due to internal contradictions in the design leading to breakdown. 

But, as an entrepreneur friend likes to say, "Every breakdown is an opportunity for a breakthrough."

This post contains some good information relevant to the issues and also some good ideas for addressing them.

Again, Marx concluded that the problem arose fundamentally from property rights and recommended abolishing them. Peter Barnes takes a similar but different tack. It is move I suspect Marx would approve in that it is a modification of capitalism that leads eventually to the adoption of socialism.

Peter Barnes posits that property rights are institutional, chiefly legal, not natural as John Locke attempted to argue based on use. I don't think Locke's argument is convincing to anyone without confirmation bias being operative. It is based on a just-so story rather than history and anthropology, like the just-so story about barter (Robinson Crusoe and Friday).

A New Capitalism: The Case for Universal Property
Peter Barnes is an entrepreneur whose work has focused on fixing the deep flaws of capitalism. He has co-founded several socially responsible businesses (including Working Assets/Credo) and written numerous articles and books, including Capitalism 3.0 and With Liberty and Dividends For All.

Jacob Weisberg - Elitist Nonsense

 The right’s favorite scare word is “elitism.’ What does it mean?

When I say the elite, I mean the ruling class, but when the Right say the elite, they mean educated people and academics, like climatologists, psychologists, and epidemiologists, etc. 

 If there’s one epithet the right never tires of, it’s “elitism.” Republicans are constantly accusing Democrats of it this campaign season, as when Kentucky Senate nominee Rand Paul attacked President Obama as “a liberal elitist … [who] believes that he knows what is best for people.” With the Tea Party’s rise, conservatives have even begun accusing each other of it, as Sharron Angle, the Nevada GOP nominee did when she charged that Robert Bennett, the outgoing senator from Utah, “has become one of the elitists that is no longer in touch.” Other days, they simply lament that the entire country is falling prey to it, as California Senate nominee Carly Fiorina recently did in asserting that “the American Dream is in danger” because of the “elitists” in charge of the government.

Thus did the son and grandson of admirals, a millionaire who couldn’t remember how many houses he owned, accuse his mixed-race opponent, raised by a single-mother and only a few years past paying off his student loans, being the real elite candidate in the campaign.

Jacob Weisberg - Elitist Nonsense

China maps path to carbon peak, neutrality under new development philosophy — Xinhua

By 2030, China's carbon dioxide emissions will peak, stabilize and then decline, and by 2060, China will be carbon neutral and have fully established a green, low-carbon and circular economy, it said, reiterating the country's previous pledge.

China maps path to carbon peak, neutrality under new development philosophy
Xinhua (Chinese state media)

Markets and Freedom — Chris Dillow

One of the great political changes of my adult lifetime has been the right’s abandonment of free market economics, as illustrated by the government imposing trade frictions within the UK and putting up the tax burden to what the OBR says will be “its highest level since Roy Jenkins was Chancellor in the late 1960s.” Two books I’ve read recently pose a question: might this shift be due in part to an awareness that markets are no longer the foundation of freedom we once thought they were?...
Interesting contrast between libertarians of the right like Friedman, Hayek and Thatcher, and libertarians of the left, here Marx in particular.

Libertarians of the right assume that freedom is the highest value and that freedom is maximized in a market economy under freed market capitalism. Libertarians of left assume that freedom is the highest value but that freedom is maximized in a socialist society with genuine democracy, that is, governance of, by and for the people, with a strong bill of rights to protect minorities from the tyranny of the majority.

Stumbling and Mumbling
Markets and Freedom
Chris Dillow | Investors Chronicle



Reddit WSB people starting to pick up on the Trump thing:

@jack: “hyperinflation will soon change everything”


Jack thinks we’re going “hyperinflation!”… “hahper!”…  if we don’t get it, this could turn out to be another Trump Curse situation… he’s already dressed for it… wouldn’t have to change clothes…

Saturday, October 23, 2021

Kay and Peele - Das Negros

 American comedy this week. 

I don't look for comedy, it just turns up in my YouTube app, but not so much has turned up lately.



Trump SPAC


This thing had a good 2 days Thursday and Friday… and it appeared to be in “liquidation only” on Friday my broker would not accept a market order to buy….  I don’t know if an ipo was ever treated like that before…

This is interesting from the Zero Hedge people here I don’t know if this is accurate or not:

Finally, we note that DWAC would have to reach $1,739 to be as large as Twitter... food for thought for analyst price targets.

And if Pinterest is supposed to be worth $50b I have to think the Trump thing would be worth at least as much as that…

Germany on the brink of legalizing cannabis | DW News

One topic in the coalition talks to form a new government in Germany is the legalization of cannabis products. All three parties are in favour of a regulated system for cultivation, trade, and sale. German pharmaceutical companies are also hoping for a boost from this.

When cannabis was legalized in Canada three years ago, many customers were eager to make the first legal purchase of marijuana. Today, the legal cannabis industry in Canada posts more than two billion euros in sales annually. The government there closely monitors cultivation and sales.

Germany on the brink of legalizing cannabis | DW News

But Nick Wright's negative experience is not uncommon. 

Friday, October 22, 2021

Biden's China Ambassador Pick Says Beijing Is "Greatest Threat" To US & The "Democratic World" — Dave DeCamp

 How to scuttle relations right out of the box in choosing diplomats.

First, the Biden administration sends Victoria Nuland to negotiate with Russia, and now is proposing an outspoken China hawk as ambassador to China. Beyond dumb unless you want to program the outcome to fail, where in your own mind failure of better relations is success. A similar situation is unfolding in negotiations with Iran that guarantee no deal.

The US is sounding more and more like the British Empire before its dissolution as a result of WWI, engineered by Britain to preserve its empire, and then WWII, which was a direct result of WWI. Let hope that is not a precedent. The US and NATO have not fought a war where the other side could actually fight back since the stalemate in the Korean War after China entered it even though China then was only a shadow of what it is now.

But ka-ching for the MICIMATT (Military-Industrial-Congressional-Intelligence-Media-Academia-Think-Tank complex) and maybe some points in the toxic environment of US domestic politics.

Biden's China Ambassador Pick Says Beijing Is "Greatest Threat" To US & The "Democratic World"
Dave DeCamp

Is There a Method Behind China’s Tech Crackdown Madness? — Ruihan Huang

The method is revealed by the numbers. China is tightening ship.

Is There a Method Behind China’s Tech Crackdown Madness?
Ruihan Huang

Links — 22 Oct 2021

All the clickable links were correct and checked. The URLs are provided separately as back up.

Moon of Alabama (traditionalism, which includes most of the world, vs. Western liberalism)
Putin's Musings On 'Wokeness'

How Biden's Too-Clever-By-Half Iran Strategy Failed

The Vineyard of the Saker
From Russia, With (Taliban) Love
Pepe Escobar

Asia Times
The world according to Vladimir Putin
Pepe Escobar

Sputnik International
Why Putin's 'Conservatism of Optimists' Approach Resonating With Traditionalists in US and EU

The Intercept (she is only the tip of the iceberg)
Sen. Kyrsten Sinema Is the Dying Scream of the Corporate Democratic Party
Ryan Grim

Sen. Joe Manchin Has Been Fighting to Keep Billions in Subsidies for Fossil Fuel Industry
Aileen Brown

The US Empire: Coercion and Consent
Supid Bhattacharya

New intelligence report warns of 'destabilizing effects' from climate change and its national security risks
Meaghan Ellis

The American Prospect
Amazon Warns Sellers: Marketplace Could Shut Down If Congress Tries to Regulate It
David Dayan

Gas under long-term contracts 4 times cheaper for EU than spot contracts - Putin

U.S. government agency in charge of financial stability weighs in on climate change risks
Emma Newburger

The Week
How the 'economics of global warming' are unfolding differently in Russia
Brigid Kennedy

International Policy Digest
Richard Carroll

Julia Corliss - "Flu shot linked to lower heart attack, stroke risk - Harvard Health"

A study published in today’s Journal of the American Medical Association finds that getting the influenza vaccine lowers a person’s odds of a having heart attack, stroke, heart failure, or other major cardiac event—including death—by about a third over the following year.

What’s the connection between flu and cardiovascular problems? “When you get the flu, your body mounts an impressive immune response, which causes a lot of inflammation. As a result, the plaque inside your blood vessels can become unstable, which can lead to blockage and a possible heart attack or stroke,” says study leader Jacob Udell, MD, a cardiologist at Women’s College Hospital in Toronto and a clinician-scientist at the University of Toronto.

  Julia Corliss - "Flu shot linked to lower heart attack, stroke risk - Harvard Health"

Black Rock’s Larry Fink blames gig economy for stoking inflation

BlackRock’s Larry Fink is less upbeat on the economy than Bank of America’s Brian Moynihan.

 BlackRock Inc. CEO Larry Fink shared a cloudier view on climate change efforts and inflation than Bank of America Corp. CEO Brian Moynihan at a virtual industry gathering on Tuesday.

Fink said the U.S.’s long-term shift toward a gig economy has left workers without traditional pensions and other benefits, and is feeding a drive toward sharper wage increases nowadays.

“You have more flexibility, but we lost the connection between our workers and many companies,” Fink said in his remarks at the Institute for International Finance (IIF) annual meeting. “The fragmentation and polarization of society is because of these issues.”

Market Watch

Black Rock’s Larry Fink blames gig economy for stoking inflation

BlackRock - The company that owns the world?

#BlackRock. There’s a good chance you have never heard of them. 

In less than 30 years, this American financial firm has grown from nothing to becoming the world’s largest and most trusted manager of other people’s money. The assets left in their care are worth a staggering 6.3 trillion US dollars – a figure with 12 zeroes.

The Confusing State of Inflation Inputs — Barry L. Ritholtz

Looks about right.

The Big Picture
The Confusing State of Inflation Inputs
Barry L. Ritholtz is co-founder, chairman, and chief investment officer of Ritholtz Wealth Management LLC.


Naked Capitalism
Supply Chain Shortages and Inflation: How Bad Will the Disruption Become?
Yves Smith

Trump curse


Now it got Alec Baldwin…. They continue to drop like flies….