So Wednesday evening I'm walking on the treadmill at the healthclub. It's a mixed experience. I feel better working out but I have to suffer through Fox News on the big TV in front in the treadmills. So I'm watching the Fox News, and predictably, they're interviewing Republicans and trying to belittle the President's State … Continue reading Romney Doesn’t Know Real History
One of the most fundamental identities in macro economics is that income = spending. Since this is a macro-level national income accounting identity, that means two things: First, it must be true after-the-fact as an accounting factoid. In other words, when the BEA adds up the numbers each quarter, the money spent in the economy … Continue reading GDI vs GDP
Division of labor, specialization, and the Web are beautiful things. In my earlier post on the 4th quarter 2010 GDP numbers I observed that inventories declined significantly and I wasn't sure why. Well, James Hamilton at Econbrowser did the heavy lifting of investigation so I don't have to. I only have to quote him: Consumption … Continue reading Update on the 4th Quarter GDP numbers
President Obama, in his never ending desperate quest to be accepted by Congressional Republicans as being just like them, even if it means abandoning the changes he was elected to lead, has changed his lead economic advisors. Simon Johnson in the NY Times observes: President Obama is embarked on a major charm offensive with the … Continue reading Fox, Hen House, Economic Advisors
Is Economics (mainstream, neo-classical economics) moral? Does increasing choices necessarily increase welfare? Professor Ed Glaeser of Harvard defends his view of the economics profession in the New York Times recently against charges that economists have "no moral compass or core". He maintains that: Improvements in welfare occur when there are improvements in utility, and those … Continue reading Choice and Welfare
National debt continue to dominate economic and political talk. This week Moody's bond rating agency downrated Japan's national government debt. The Serious People and Talking TV Heads will be full of dire prognostications for Japan. Of course, I don't see why we should believe Moody's or S&P anymore after they reassured us for years that … Continue reading No, Sovereign Currency Nations Don’t Go Bankrupt
The numbers for the flash estimate are out today from BEA for U.S. GDP growth, 4th quarter 2010. I'll let Calculated Risk summarize the headlines: Advance Report: Real Annualized GDP Grew at 3.2% in Q4 by CalculatedRisk on 1/28/2011 08:30:00 AM From the BEA: Real gross domestic product -- the output of goods and services … Continue reading GDP 4th Quarter 2010
I haven't commented on the State of the Union speech or either of the Republican rebuttals yet. I don't know if I will or not, it depends on time. But I know one thing about the President's new initiatives. He has rhetorically endowed them with the name "Win The Future". I understand the sentiment and … Continue reading SOTU – WTF?
Students are often curious and perplexed by the level of disagreement among economists, particularly macroeconomists. They hear the competing claims of politicians and others and get confused. While economics, and macro in particular, has always been rife with competing views, the Global Financial Crisis and Great Recession of recent years has exposed and highlighted these … Continue reading FCIC: Hidden Assumptions and Policy Debates
When I was on a TV call-in discussion show in December, one caller asked if it would help employment in Michigan if Michigan were to become a right-to-work state. I answered that no, it wouldn't since the evidence indicates that wages are lower in right-to-work states and that home-grown entrepreneurship in fast growing, technology oriented … Continue reading Right to Not Work States?