Great guy. He runs a subscription service called Real Vision, which is imo one of the best market analysis services available. Loads of interviews with market makers etc.
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The Economics Thread
- Thread starter ManUtd1999
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Deutsche Bank have failed Feds stress tests. Not having the German claims they wouldn't bail them out.
That is totally correct, and I am currently at the "further refinement of unimportant details" in my project.
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Ugh. That makes uncomfortable reading.
The takeaway could also be to redistribute the effects of low skilled immigrant workers from the high skilled natives to low skilled natives. The thread doesn‘t mention an all-materialistic calculation neg/pos unless I missed something.
http://www.nber.org/papers/w24850
We show that eliminating firms’ access to tax havens has unintended consequences for economic growth. We analyze a policy change that limited profit shifting for US multinationals, and show that the reform raised the effective cost of investing in the US. Exposed firms respond by reducing global investment and shifting investment abroad — which lowered their domestic investment by 38% — and by reducing domestic employment by 1.0 million jobs. We then show that the costs of eliminating tax havens are persistent and geographically concentrated, as more exposed local labor markets experience declines in employment and income growth for over 15 years. We discuss implications of these results for other efforts to limit profit shifting, including new taxes on intangible income in the Tax Cuts and Jobs Act of 2017.
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They are interpreting the actual policy without realizing it will never be implemented becaue of the current political dynamics (GOP in control). Therefore the Sanders is just publicly shaming Amazon and Walmart to get them to raise wages.
That might be one aspect. Sanders might become the next candidate for the Dems and he would have a realistic shot at winning. It's entirely justified to listen to what he says and to take it seriously even so currently his ideas won't be implemented.
The conclusion a) Sanders is far less radical than his rhetoric indicates at times b) he is clueless when it comes to actual policies beyond superficial talking points.
On a completely different topic:
Argentina is in meltdown and went back to the IMF to get help. The same IMF that fecked them over at the beginning of the 21th century. The same IMF, that promotes the wrong approach again. I don't know who is advising Macri, but they are the wrong people. I don't even know why they even keep their own shithouse currency. Just dollarize it and move on.
At the same time Cristina is dealing with heir own corruption scandle. Anyone who is interested might check-out "notebook-scandle" (cuadernos de las coimas). Its about a driver, who kept detailed notes of the bags of money he distributed to various people. Allegedly incl. Cristina herself. Hopefully someone makes a film out of it.
Soon there are elections in Brazil. Their economic situation gets less international coverage, because they are less exposed to investment held in foreign currencies, but they are in deep shit. Genuinely deep shit. While Argentina has a fiscal deficit of 5%, they have one over 9%. Its hard to overstate just how bad this is. At the same time they already have pretty high tax rates. European taxes with African services. A huge share of their expenditures is mandatory spending. The biggest two positions are pensions and debt service. Mandatory spending continues to outgrow taxes. They have very little room to maneuver. Brazil absolutely needs a pension reform, but that is a bit of a poisoned chalice and nobody seems to have the stomache to do it. I might add that the brazilian pension system is extremely regressive. A reform isn't just necessary to limit the expentitures, but to create a tiny bit of fairness. The whole thing could be resonably framed in terms of economic justice, but the sad irony is that the PT (workers party) is against any reform for political reasons. I had a soft spot for them but they have to take responsiblity for the whole mess that the country is in. Almost 10% GDP crunch, weak recovery, out of control budget. And even so there will be a new president, the congress will be filled with the same idiots, who paralysed the country. The candidates for the presidency are also hardly exciting. Anyone but Jair Bolsonaro has to be the motto, but nobody should expect anything from whoever wins it.
Argentina is in meltdown and went back to the IMF to get help. The same IMF that fecked them over at the beginning of the 21th century. The same IMF, that promotes the wrong approach again. I don't know who is advising Macri, but they are the wrong people. I don't even know why they even keep their own shithouse currency. Just dollarize it and move on.
At the same time Cristina is dealing with heir own corruption scandle. Anyone who is interested might check-out "notebook-scandle" (cuadernos de las coimas). Its about a driver, who kept detailed notes of the bags of money he distributed to various people. Allegedly incl. Cristina herself. Hopefully someone makes a film out of it.
Soon there are elections in Brazil. Their economic situation gets less international coverage, because they are less exposed to investment held in foreign currencies, but they are in deep shit. Genuinely deep shit. While Argentina has a fiscal deficit of 5%, they have one over 9%. Its hard to overstate just how bad this is. At the same time they already have pretty high tax rates. European taxes with African services. A huge share of their expenditures is mandatory spending. The biggest two positions are pensions and debt service. Mandatory spending continues to outgrow taxes. They have very little room to maneuver. Brazil absolutely needs a pension reform, but that is a bit of a poisoned chalice and nobody seems to have the stomache to do it. I might add that the brazilian pension system is extremely regressive. A reform isn't just necessary to limit the expentitures, but to create a tiny bit of fairness. The whole thing could be resonably framed in terms of economic justice, but the sad irony is that the PT (workers party) is against any reform for political reasons. I had a soft spot for them but they have to take responsiblity for the whole mess that the country is in. Almost 10% GDP crunch, weak recovery, out of control budget. And even so there will be a new president, the congress will be filled with the same idiots, who paralysed the country. The candidates for the presidency are also hardly exciting. Anyone but Jair Bolsonaro has to be the motto, but nobody should expect anything from whoever wins it.
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The Brazilian Trump got stabbed today, although not too bad, just a superficial wound. Suspicious as feck.
edit. now the news is the wounds are worse than thought.
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The funny thing is, they're not even that strapped for cash. They still have enough money to run for another 18 months at least.
Trust the Argies to kick Macri out through with another round of violent protests.
On the IMF, I have never seen a more inept organisation. Their policies do not work and they keep insisting on them...it's madness.
If recommend anyone to listen to Joseph Stiglitz lecture on the IMF.
Brazil was being touted as a tiger economy a few years back wasn't it?
Yes. Growth rate was through the roof under Lula and he spent the money like there was no tomorrow.
it was due to the commodity boom of the noughties. After that its almost permanent crisis and its in another "lost decade" situation. These commodity booms are a double edged sword.
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https://www.ft.com/content/bef83be0-b280-11e8-8d14-6f049d06439c
Its a good article even so it puts too much emphasis on psychology and not the underlying problems. What you see in Argentina is what you get when a country runs a fiscal deficit for 70 years, while desperately trying to maintain an insular economy in a globalising world.
Its a good article even so it puts too much emphasis on psychology and not the underlying problems. What you see in Argentina is what you get when a country runs a fiscal deficit for 70 years, while desperately trying to maintain an insular economy in a globalising world.
There was an excellent article in the ST magazine yesterday from an economist looking at global macroeconomics in the decade post the 2008 crash. Surprisingly left-leaning considering the publication it was in. Well worth digging out and having a read.
tl;dr
We’ve been fecked over by reckless financial institutions that still haven’t been adequately punished/regulated. QE (among other things) means the poor have got less poor but this people on middle income have ended up a lot less well off, while the very wealthy have got even wealthier. The best way to move towards a less divided society is to shut down all the overseas tax havens and find a way to get that money back in circulation.
tl;dr
We’ve been fecked over by reckless financial institutions that still haven’t been adequately punished/regulated. QE (among other things) means the poor have got less poor but this people on middle income have ended up a lot less well off, while the very wealthy have got even wealthier. The best way to move towards a less divided society is to shut down all the overseas tax havens and find a way to get that money back in circulation.
100% agree.
If anyone's after some analysis with an Australian flavour, Greg Jericho writes well in the Guardian
https://www.theguardian.com/business/grogonomics
https://www.theguardian.com/business/grogonomics
sadly the article is behind a pay-wall.
I think it was a summary of a book by the same author. Which is possibly worth searching out if this is your field.
Can't find it online- which economist is it?
as far as I can tell its not a book but an article in the LRB. The author isn't an economist. I havn't finished reading it yet but also wouldn't necessarily recommend it.
https://www.lrb.co.uk/v40/n13/john-lanchester/after-the-fall
Cheers. His name rings a bell from somewhere or other.
To be fair, there's nothing in that tl;dr; section that is not common knowledge and widely accepted as fact. Any financial crisis and any necessary response to it, aways hits the lower incomed people much harder.
As for the tax heavens, it's generally accepted that they are a source of many evils: a source of inequality, of legal tax avoidance and deprivation of revenue from governments, of lack of faith in the establishment from civilians etc. However the vested interests are so strong that I believe hell will freeze over before they are shutdown without a viable alternative in place for the those rich persons/buisnesses.
https://www.thetimes.co.uk/past-six...t-followed-the-2008-financial-crash-cxscrmmj9
Actually, I don't think he is an economist. He's written a couple of books on finance though. Seem mainly to be pitched at normal punters like me.
According to the data in his article, the poorest people in society have done quite well in the 10 years post the crash.
Cheers. Bah, can't remember my boss's Times login.
It only looks well if we consider UN absolute poverty line($1.90 a day.)useful which can be easily debate not to be. If we raise it up to just $10 or $15(Again absurdly low amount) than it completely changes the outlook.
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Still I agree with a lot of the article.
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I haven't read the article yet, but that's contradicting to pretty much everything else I've read. Compared to pre-crisis we've got:
a) increased number of families resorting to food banks
b) increased number of families listed as homeless (peaked only last year)
c) wage stagnation with real wages shrinking
d) welfare cuts
...among many others. All of that stuff bites the poorer much harder than anyone else.
Is the article very big and if not, is it possible to copy in a spoiler here? I'd quite like to read it but it's behind a log in.
The article is talking about the poorest people in the world. People using food banks, being homeless and on welfare are actually in the ''middle''. Basically if all you've got is £10 in your pocket to live on than your doing better than the ''thriving'' poor.
The poverty stuff is about the world as a whole.
As a (relatively) well off country, people living in the UK are much more likely to be feeling the pinch of austerity than they are any benefits felt by whatever shift there might be from extreme to relative poverty overall.
Not sure about copying in a spoiler. Isn’t that against caf rules? Doesn’t anyone buy a copy of the Sunday Times any more? I thought that was part of a standard weekend routine!