Saturday, April 29, 2017

Bank of America has the most capital of any bank in the US


Regulatory ratios.


By this measure, there's no question that Bank of America is massive. At the end of the third quarter, it reported just under $2.2 trillion worth of total assets on its balance sheet, split between loans, interest-earnings securities, and a variety of other asset types. Yet, even though that's enormous, it's nevertheless smaller than one of Bank of America's principal competitors: JPMorgan Chase. Going into the financial crisis, JPMorgan was ranked third in terms of assets -- Citigroup was first, followed by Bank of America. Fast forward to today, however, and JPMorgan Chase is now the biggest bank in the United States, with $2.5 trillion worth of assets on its balance sheet -- click here for the full list of America's 10 biggest banks by assets.

if you measure size a slightly different way. Namely, by looking at the quantity of shareholders' equity, or capital, on their respective balance sheets.

When you measure size in this way, it turns out that Bank of America is actually the biggest bank in the United States. It has $270 billion worth of capital compared to JPMorgan's $254 billion. Citigroup and Wells Fargo round out the four biggest banks by capital, at $232 billion and $203 billion, respectively.

1:10 on Leverage.

So the recent swing in Reserve Assets of $400B would have to be covered by $40B of capital at this 1:10 ratio.  About 4% of the four money center bank total capital.


Business Insider
Bank of America has the most capital of any bank in the US



Deutsche Bank: A Greek Tragedy at a German Institution?


More success by the clever "bankster!" geniuses operating the "neoliberal conspiracy!" shifting all of the wealth up to the top.

Whatever the reasons, in 2014 and 2015, Deutsche reported cumulative losses of close to $16 billion, leading to a management change, with a promise that things would turn around under new management. The other dimension where this crisis unfolded was in Deutsche’s regulatory capital, and as that number dropped in 2015, Deutsche Bank's troubles moved front and center.


Musing on Markets
Aswath Damodaran

Friday, April 28, 2017

Edward Harrison — Why the euro crisis will happen again and Italy will be involved

This morning, as the data were coming in from Europe for Q1 GDP, I got a reminder from Twitter about the inherent deflationary nature of the euro area’s design.| And this goes directly to how to think about credit risk in Europe.

I followed a twitter post to a Charles Goodhart article from 1997, written before European Monetary Union. And he was saying things that the late British economist Wynne Godley was banging on about five years earlier when the Maastricht Treaty set out the terms for euro. Here’s the crux as it relates to credit risk in Europe:
Credit Writedowns
Why the euro crisis will happen again and Italy will be involved
Edward Harrison

Thursday, April 27, 2017

Stephen Holmes — The future of DDoS attacks looks scary. Blockchain will protect us

The ease of launching massive DDoS attacks will grow and no existing system can address this problem unless it is truly distributed. The blockchain may serve as the best remedy.
American Banker
The future of DDoS attacks looks scary. Blockchain will protect us
Stephen Holmes | vice president of the fintech lab at VirtusaPolaris

See also

Denial-of-service, web app attacks plague banks
Penny Crosman


Neil Wilson — The Bond Economy

Alex Douglas raised the mainstream view of government budget constraintsagain this week, where he was ably assisted in his argument by Brian Romanachuk.
The bone of contention is whether governments can continue borrowing indefinitely. Alex and Brian demonstrate that the mathematics of the mainstream is based upon assumptions that cannot and do not hold in reality.
The popular defence at the moment is that everything fails if r > g. Bad things happen if the growth in the rate of debt/interest is greater than the growth in GDP. But what does that actually mean in practice?
To show what it means, I’ve built a little three agent model in a spreadsheet. This model is the mainstream economist and basic income fan’s dream scenario. Everybody gets a payment straight from government and all anybody cares about is earning interest....
Modern Money Matters
The Bond Economy
Neil Wilson

Bill Mitchell — The destruction of Greece – “only a down payment” according to the IMF

On April 22, 2017, the Italian Minister of Economy and Finance, Pier Carlo Padoan presented a briefing to the 25th Meeting of the International Monetary and Financial Committee of the IMF in Washington. He spoke on behalf of Albania, Greece, Italy, Malta, Portugal and the Republic of San Marino. This annual event examines the “macroeconomic outlook” of the nations in question and conditions the IMF policy approach for the year ahead. Padoan, an ardent pro-Eurozone supporter, told the gathering that in the last year, the Greek economy was recovering and that “GDP remained stable in 2016, while for the first time since 2010 two consecutive quarters of growth were reported”. I wonder what data he was looking at. The official national accounts data for Greece doesn’t tell that story. With Greece still wallowing in the depths of recession, it is clear that the IMF hasn’t finished with the destruction of that formerly independent nation. The destruction to date (27 per cent contraction and increased poverty) are considered by the IMF to be “only a down payment” on what Greece has to do so satisfy the Troika. At what point do people start to realise that the on-going costs of this austerity dwarf the significant costs that would accompany exit? And the Troika is not done with Greece yet. They intend to screw it down even further. And the costs of remaining in the dysfunctional monetary union escalate by the day. At some point, the Greeks will realise they have been dudded. What is left is anyone’s guess – but it won’t be pretty. The destruction of Greece is “only a down payment” according to the IMF – keep that mentality in mind when you are working out whether Greece should remain obedient or tell them all to f*ck off and regain their currency independence and restore prosperity.
What happens when a country becomes a colony.

Bill Mitchell – billy blog
The destruction of Greece – “only a down payment” according to the IMF
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Wednesday, April 26, 2017

Robert Wade — The market paradigm versus the production paradigm

As Ricardo is the source of the market paradigm, Charles Babbage is the source of the production paradigm, in the form of his 1832 book, On the Economy of Machinery and Manufacturers.[8] His successors included Alfred Marshall, Allyn Young, Edith Penrose and George Richardson. It is a fair bet that most economics PhD students in Anglo universities have never heard of these people, let alone read them.
The production paradigm says that the core mechanism of how economies transform (or not) lies in the combination of production capabilities, business organization, and economic governance; or what Michael Best calls the “capability triad”. Economies with high capability pivot on a sufficient density of “entrepreneurial” firms which pull basic and applied R&D or production and marketing ideas from MNCs [Multi-National Corporations] with branches in the economy in question, into innovation in products, processes, organizations, and marketing. These entrepreneurial firms do not emerge by themselves as a natural result of a well-working market. Their own internal capacity development requires a larger ecosystem of finance, skills and S&T partnerships; which depends on trust in social interactions, and therefore physical and/or cultural proximity. The government (national or regional) is the organizer, the steward of the infrastructure needed to support this ecosystem....
Real-World Economics Review Blog
The market paradigm versus the production paradigm
Robert Wade | Professor of Political Economy and Development at the London School of Economics

Jefferson Morley — It's Official: How the Koch Brothers Killed Trump’s Job Plan


That was quick.

This is the big problem with electing outsiders to clean up government and put the people first, as Jesse Ventura found out, for example. Outsiders have no political base once they begin governing unless there is a wave election that results in a a wholesale replacement of insiders with outsiders. And even with a wave election, there is still the administrative bureaucracy and the deep state, which both provide continuity across administrations.

AlterNet
It's Official: How the Koch Brothers Killed Trump’s Job Plan
Jefferson Morley, AlterNet

Brian Romanchuk — Does The Governmental Budget Constraint Exist?


Illustrates the point that the so-called intertemporal governmentalI budget constraint (IGBC) is "fuzzy" if not illogical, and its "proof" involves a lot of handwaving.

Bond Economics
Does The Governmental Budget Constraint Exis
Brian Romanchuk

Bill Mitchell — Deutsche Bundesbank exposes the lies of mainstream monetary theory

On one side of the Atlantic, it seems that central bankers understand the way the monetary system operates, while on the other side, central bankers are either not cognisant of how the system really works or choose to publish fake knowledge as a means to leverage political and/or ideological advantage.|

Yesterday, the Deutsche Bundesbank released their Monthly Report April 2017, which carried an article – Die Rolle von Banken, Nichtbanken und Zentralbank im Geldschöpfungsprozess(The Role of Banks, Non-banks and the central bank in the money-creation process). The article is only in German and provides an excellent overview of the way the system operates. We can compare that to coverage of the same topic by American central bankers, which choose to perpetuate the myths that students are taught in mainstream macroeconomic and monetary textbooks. Today’s blog will also help people who are struggling with the Modern Monetary Theory (MMT) claim that a sovereign government is never revenue constrained because it is the monopoly issuer of the currency and the fact that private bank’s create money through loans. There is no contradiction. Remember that MMT prefers to concentrate on net financial assets in the currency of issue rather than ‘money’ because that focus allows the intrinsic nature of the currency monopoly to be understood.
Bill Mitchell – billy blog
Deutsche Bundesbank exposes the lies of mainstream monetary theory
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia

Tuesday, April 25, 2017

Priebus — Syria, China moves part of 'Trump Doctrine'


Trump Doctrine:  Shoot first and ask questions later?

Just kidding — sort of.

The HiIl
Priebus: Syria, China moves part of 'Trump Doctrine'
Jordan Fabian

Jason Smith — Should the left engage with neoclassical economics?


Getting the left up to speed by understanding information. There's a lot of good stuff in this post.

Information Transfer Economics
Should the left engage with neoclassical economics?
Jason Smith

Pedro Nicolaci da Costa — There’s a reason poor countries feel they've lost control of their economies

The increasing integration of global markets and economies, in addition to new technologies that help accelerate the transmission of financial shocks from one region to another, is making it trickier for so-called emerging countries to manage their banking systems.
A surge in dollar-denominated bonds in developing economies, and their dependence of the vagaries of the richest nations, leave policymakers in areas like Latin America, Africa and Asia in difficult, if not entirely untenable positions, according to the International Monetary Fund’s latest report on global financial stability. Currency markets are particularly vulnerable and volatile....

Paul Craig Roberts — The Looting Machine Called Capitalism


PRC finally wakes up and smells the coffee and becomes a Marxian, even though he probably doesn't realize it yet in those terms. Maybe Michael Hudson will clue him in, since he got a lot of his new-to-him economic ideas from Hudson. Recall that PCR was one of the original Reagan supply-siders. How things change. And if someone with PCR's background can be turned around, there's hope.
I have come to the conclusion that capitalism is successful primarily because it can impose the majority of the costs associated with its economic activities on outside parties and on the environment. In other words, capitalists make profits because their costs are externalized and born by others. In the US, society and the environment have to pick up the tab produced by capitalist activity....
"Privatize profits; socialize costs."

Paul Craig Robert.org
The Looting Machine Called Capitalism
Paul Craig Roberts

Sputnik International — Putin: Russia to Keep Ruble's Floating Rate, Seeking Market Tools


Currency stability is a high priority for both Russia and China.

Sputnik International
Putin: Russia to Keep Ruble's Floating Rate, Seeking Market Tools

Inessa Sinchougova — Japan's forces accumulate on Russia's Eastern borders


Just when you thought things couldn't get much worse.

Fort Russ
Japan's forces accumulate on Russia's Eastern borders
Politnavigator- by Inessa Sinchougova

Also
RIA Novosti. The Ministry of Defense of the self-proclaimed Donetsk People's Republic announced the arrival of US military instructors in the conflict zone in the Donbass.
Donetsk Defense Ministry report: US advisors at the front.
Ria.ru, translated by Tom Winter

You know, the folks DJT accused of trying to start WWIII.

CronkiteNews
Guess who’s coming to dinner? Trump hosts McCains, Graham

LobeLog
Trump and the Yemeni Quagmire
Giorgio Cafiero
A few hour ago the Turkish airforce hit Kurdish and Yezidi positons on both sides of the Singal mountains in east-Syria and west-Iraq. Near Derik in east-Syria more than 20 bombs destroyed a YPG headquarter, a radio station and a media center. At least nine YPK fighters were killed. The YPG is the Syrian sister organization of the Kurdish PKK in Turkey. The PKK is a designated terrorist organization. Within Syria U.S. special forces are embedded with the YPG and are coordinating YPG moves against the Islamic State in Raqqa. YPK and PKK follow the anarcho-marxist theories of their leader Abdullah Öcalan who is in isolation detention in Turkey.
Moon of Alabama
Turkish Airstrikes On Kurds Complicate U.S. Operations In Iraq And Syria

The crazy.

Independent
Theresa May would fire UK’s nuclear weapons as a ‘first strike’, says Defence Secretary Michael Fallon
Rob Merrick | Deputy Political Editor
In case the UK strikes a nuclear power, then “the UK, which doesn’t have vast territory, will be literally wiped off from the face of the earth with a counterstrike,” Klintsevich said.
RT
UK risks being ‘wiped off the map with nuclear counterstrike’ – Russian senator

RT
10-minute warning: Japan instructs citizens on potential North Korea strike
TRNN
Wilkerson: Trump Admin's Iran Talk Sounds Like Bush's Pre-Iraq War

Calling bullshit.

RI
Lavrov Dismantles UK-Led Sarin 'Investigation' in 30 Seconds

Irrussianality
Electrical separation
Paul Robinson | Professor, Graduate School of Public and International Affairs at the University of Ottawa
Iraq War architect Paul Wolfowitz now has Donald Trump's ear. This can only end badly.
AlterNet
Are Neoconservatives Marching the United States into a Fresh New Hell?
Heather Digby Parton


Reuters — U.S. Announces New Tariffs on Canadian Lumber After Trade Spat Over Dairy Farmers


MAGA.

Fortune
U.S. Announces New Tariffs on Canadian Lumber After Trade Spat Over Dairy Farmers
Reuters

JP Koning — Leaving a monetary union is difficult, but Hawaii pulled it off


I'll bet you didn't know about this. I didn't either.

Moneyness
Leaving a monetary union is difficult, but Hawaii pulled it off
JP Koning

Alexander Dugin — Fourth Political Theory: Shortest Presentation


This is a bit wonkish, since Dugin covers a lot of ground in a few words and graphs. But take my word for it as someone who has studied this stuff, Alexander Dugin is a brilliant thinker that is is capable of thinking outside the box. Whether one agrees with his conclusions, his range and depth of analysis is impressive.

He argues in this "shortest presentation" that the Modern period that began philosophically with Descartes putting subjectivity at the center. Modernity spawned three social and political philosophies to replace both medieval Scholastic philosophy and also the revival of the classics in the Renaissance, as well as feudalism as the dominant social, political and economic institution. These three were 18th century liberalism, 19th century communism, and 20th century fascism. As Modernity winds down in the 21st century, liberalism has emerged victorious over communism and fascism and there is no returning to either of those vanquished contenders. 

The result is that either liberalism will remain dominant or an alternative will emerge. Dugin argues that liberalism, being a product of Modernity, is condemned by time. It must either change into a new form of liberalism or be replaced by an alternative yet to emerge as the Modern period transitions into the Post Modern (which should not be confused with Post Modernism). 

As focus shifts away from subjectivity as central, which is the basis of individualism as the core of liberalism, a new historical moment is emerging. Individualism is running up against its limits in the liberal West, which has been the center of Modernity. Paradoxes of liberalism are rising, for example, as modern liberalism seeks to impose itself illiberally through forced conversion.

Dugin speculates that the alternative that is emerging is a Post Modernity that harkens to Pre-Modernity and the Great Chain of Being that was replaced by the rise of modern science and the enormous success of technology. But this does not meaning returning to the past either, which is not possible anyway.

He appeals to Heidegger's analysis of Dasein, literally being there, that is, being present, without going into the specifics of Heidegger's thought in this "shortest presentation." But those familiar with Heidegger will understand that Dugin is implying his Heidegger's critique of the ontological (existence) versus the ontic (essence), the challenge of "technicity," and the distinction between the authentic person and the conformist personality. The challenge is being chained to matter (determinism with illusion of freedom) or rising above in spirit (realizing genuine freedom). Modernity has confused an illusion of freedom with actual freedom.

I admit some confirmation bias here, but I had come some similar conclusions before encountering Dugin. While his view differs from mine, since our vantage points are quite different, it seems to me that he is on the right track. Modernity was something of a historical aberration and the course of history is likely to revert to its historical trajectory instead of Modernity being the end of history as many in the West either believe or would like to believe. 

Liberalism will be incorporated into Post Modernity, but its extremes will be tempered and its extravagances will be modulated as absorption in the subjective characteristic of Modernity is transcended, and a more holistic view emerges to temper radical individualism.

Geopoliticka.ru
Fourth Political Theory: Shortest Presentation
Alexander Dugin

Monday, April 24, 2017

Daria Dugina — France: Globalism Vs Patriotism


Professional analysis of French politics from the POV of geopolitics and geostrategy.

Geopolitica.ru
France: Globalism Vs Patriotism
Daria Dugina (daughter of Alexander Dugin)

Suzanne Venker — Campus Free Speech Is The Least Of It: What I Learned From My Visit To Bard


This short post says a lot about reality construction. The author is a controversial speaker who was invited to speak at Bard College. She was received politely and delivered her presentation. Her complaint is that the students were so brainwashed that they did not agree with her.

Parallel realities.

Both the speaker and the student think that the other has been blue-pilled, and they have popped the red pill.

This is normal wherever ideology is prevalent, and this includes economics.

The Daily Caller
Campus Free Speech Is The Least Of It: What I Learned From My Visit To Bard
Suzanne Venker | Fox News Contributor



Mitch Horowitz — Believe It or Not: The New Age and Occult Underpinnings of Trump and Bannon's Ideology


This is not about Trump and Bannon as the title suggests but about the American psyche and "pop mysticism." Many Americans probably know at least something this already, since it has been reported in the media. But most people abroad may not, and it is important to realize as a key factor in American behavior, as well as a contributor to the formulation of US policy. It is a short post and there is much more to the story.

Regardless of one's prior knowledge of this, the beliefs that Horowitz identifies make an important contribution toward explaining the prevalence and power of "American exceptionalism" as a cornerstone of the American mindset. 

This is also explains the longstanding policies of liberal internationalism and liberal interventionism as Americans seek to bring "the blessings of liberty" to the entire world, regardless of whether others want to be "liberated."

AlterNet
Believe It or Not: The New Age and Occult Underpinnings of Trump and Bannon's Ideology
Mitch Horowitz, Salon

Pepe Escobar — Emmanuel Clinton vs Marine LeTrump

 
I have argued on Asia Times that Macron is nothing but an artificial product, a meticulously packaged hologram designed to sell an illusion.
Only the terminally naïve may believe Macron incarnates change when he’s the candidate of the EU, NATO, the financial markets, the Clinton-Obama machine, the French establishment, assorted business oligarchs and the top six French media groups....
Everyone in Brussels “voted” Macron as he proposes a budget for the eurozone, a dedicated Parliament, and a dedicated Minister of Finance. In short; Brussels on steroids....
Then illusion and the reality:
If the coming, epic clash could be defined by just one issue that would be the unlimited power of the Wall of Cash.
Macron subscribes to the view that public debt and expenses on public service are the only factors responsible for French debt, so one must have “political courage” to promote reforms.
Sociologist [not economist] Benjamin Lemoine is one of the few who’s publicly debating what’s really behind it — the interest of financiers to preserve the value of the debt they hold and their aversion to any negotiation.
Because they control the narrative, they are able to equate “political risk” — be it Marine or Mélenchon — with the risk to their own privileged positions.
The real issue at stake in France — and across most of the West — revolves around the conflicting interests of financial masters and citizens attached to public service and social justice....
Asia Times
Emmanuel Clinton vs Marine LeTrump
Pepe Escobar

Bloomberg — Jack Ma Sees Decades of Pain as Internet Upends Old Economy


Change is not the issue, since change is inevitable. Rather, the accelerating pace of change is overwhelming many and leaving a lot of people behind. Unless this is modulated, social disruption will result from disruptive technology.

Bloomberg
Jack Ma Sees Decades of Pain as Internet Upends Old Economy
ht Automatic Earth

Bill Mitchell — German trade surpluses demonstrate the failure of the Euro

The election of Donald Trump has stirred up the IMF and Germany, in particular.|Trump’s trade advisor has claimed that Germany is manipulating the currency to maintain its competitiveness. A more general view is that the massive German external surplus is a reflection of a dysfunctional Eurozone, particularly the failed monetary policy stance of the ECB and the lack of a European-level (federal) fiscal policy capacity and willingness to expand domestic demand in the Member States. In fact, both views have credibility as I will explain. Last week (April 19, 2017), Eurostat released the latest trade data for the Eurozone – Euro area international trade in goods surplus €17.8 bn. It showed that Germany’s trade surplus continues to grow (it was 35.4 billion euros in January-February 2017, up 1.4 billion over the 12 months) in total. In 2016, Germany’s current account surplus was 8.6 per cent of GDP, which is obviously an outlier. What is required to redress this on-going dysfunction within the Eurozone would appear to be beyond the political mentality of the establishment polity in the Eurozone. And with Macron’s elevation to an almost certain Presidential victory in France, it is hard to see any dynamic for now emerging that will create change for the better. So as usual, the Eurozone muddles on – with a dysfunctional design architecture and an even more dysfunctional attitude to policy flexibility held by the powers to be. Germany is seriously responsible for a lot of this dysfunction.
Germany is operating with the euro as a discounted DM. All the other nations using the euro are operating with a currency premium. 

Bill Mitchell – billy blog
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia
zone

Sunday, April 23, 2017

Andrew Batson — What is the real driver of the Russian revanche?


Important. Another paradox of liberalism. Liberalism creates its own enemies.

Andrew Batson's Blog
What is the real driver of the Russian revanche?
Andrew

Ingrid Harvold Kvangraven — 200 Years of Ricardian Trade Theory: How Is This Still A Thing?

On Saturday, April 19th 1817, David Ricardo published The Principles of Political Economy and Taxation, where he laid out the theory of comparative advantage, which since has become the foundation of neoclassical, ‘mainstream’ international trade theory. 200 years – and lots of theoretical and empirical criticism later – it’s appropriate to ask, how is this still a thing?

This week we saw lots of praise of Ricardo, by the likes of The Economist, CNN, Forbes and Vox. Mainstream economists today tend to see the rejections of free trade implicit in Trump and Brexit as populist nonsense by people who don’t understand the complicated theory of comparative advantage (“Ricardo’s Difficult Idea”, as Paul Krugman once called it in his explanation of why non-economists seem to not understand comparative advantage). However, there are fundamental problems with the assumptions embedded in Ricardo’s theory and there’s little evidence, if any, to back up the Ricardian claim that free trade leads to benefits for all. On this bicentenary, I therefore think it’s timely to revisit some of the fundamental assumptions behind Ricardo’s theory of comparative advantage, that should have led us to consider alternative trade theories a long time ago....
Good summary backgrounder. "It's more complicated than that," the "that" being what is assumed.

The following quote contains an important lesson about logic and epistemology.
Rather than accept that there is something wrong with the exchange rate theory itself, empirical discrepancies are explained by measurement problems and/or imperfections in the market because of currency ‘manipulation’ (see for example Eichengreen 2013 or Gagnon 2012). In fact, neoclassical trade theory is so highly regarded that economists, almost across the board, cannot imagine any reason for China’s trade surplus with the US other than the Chinese manipulating their exchange rate in order to stimulate their exports.
What has happened here is that the theoretical model become the criterion for assessing truth rather than a model to be compared with observation in measurement.

Take probability theory. Probability theory shows the outcome of a long run roll of a coin toss, regardless of whether it is an ensemble of 1000 coins tossed at once or a single coin tossed a 1000 times. If the outcome does not converge on 0.50, then the fairness of the coin becomes suspect and not the theory.

This is not necessarily the case with a scientific theory. In the case of an anomaly scientists check the experiment but after checking and finding no errors, the theory becomes suspect. Repeated failures result in re-thinking the theory.

Because it is difficult to impossible to run controlled experiments in economics in many cases, trade being one of them, the dominant theory is never questioned. It serves as a criterion of truth whose truth is privileged from question.

Developing Economics
200 Years of Ricardian Trade Theory: How Is This Still A Thing?
Ingrid Harvold Kvangraven | PhD student in Economics at the New School for Social Research

Brian Romanchuk — SFC Models And Introductory MMT-Style Fiscal Analysis

The usefulness of Stock-Flow Consistent (SFC) models is that they allow us to illustrate concepts in economics without relying solely on verbal descriptions.
In this article, I will discuss my interpretation of some of the ideas floating around in Modern Monetary Theory (MMT). I will note that these are my interpretations of statements made by others, illustrated by an extremely simple model. The key is that even simple models can be used to clarify our thinking.
This article is only a partial response to an article by Gerard MacDonell. He is unhappy about some of the writings of Professor Bill Mitchell, one of the leading MMT economists.
I am not going to argue on Mitchell's behalf, rather I just want to offer some analysis that touches on some of the technical issues Gerard made. He noted that Federal taxation and spending are roughly similar, so how does that square with MMT pronouncements about the independence of taxation and spending? This outcome is not surprising, as it is exactly the sort of thing that is predicted by SFC models -- and MMT mathematical analysis of the economy uses SFC models.
For those if you who are not fully up-to-date on post-Keynesian factionalism, please note that SFC models were meant to be a mathematical lingua franca for post-Keynesian economics. In other words, MMT economists use SFC models, but they are not exclusive to MMT.
Since I want to work with my Python modelling framework here, and it currently cannot support full business cycle analysis (extensions will be added later), I cannot do complete justice to Functional Finance. Therefore, I have to just focus on a couple of more basic ideas about fiscal polict
  1. there is little relationship between taxes and spending; and
  2. governments cannot control the budget deficit.
I will address these here in turn....
Bond Economics
SFC Models And Introductory MMT-Style Fiscal Analysis
Brian Romanchuk

Saturday, April 22, 2017

Jason Smith — Economics to physics phrasebook


Fun.

Information Transfer Economics
Economics to physics phrasebook
Jason Smith

See also

Good ideas do not need lots of invalid arguments in order to gain public acceptance



Branko Milanovic — A theory of the rise and fall of economic leadership: review of Bas van Bavel’s “The Invisible Hand?”

The recently published “The invisible hand?: How market economies have emerged and declined since AD 500” (Oxford University Press, 2016, 330 pages) by Bas van Bavel has, like all important books, a relatively simple core theory which Van Bavel, a well-known economic historian teaching at the University of Utrecht, illustrates on five historical examples: Iraq between 500 and 1100, Central and Northern Italy 1000-1500, the Low Countries 1100-1800, England 1800-1900, and the United States 1800-today. (The first three cases are discussed in detailed separate chapters, each running to 50-60 pages, while the last two, to which Western Europe may be appended, are discussed in a single chapter called “Epilogue”)....
Global Inequality
A theory of the rise and fall of economic leadership: review of Bas van Bavel’s “The Invisible Hand?”
Branko Milanovic | Visiting Presidential Professor at City University of New York Graduate Center and 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