The No Mo or Mighty Mo Forecast and Harry Truman’s Quest for a One-Armed Economist

At the end of World War II, lore has it that Harry Truman’s economists facing a wide range of possible economic outcomes advised him that “on one hand this, and on the other hand that”. Truman eventually had enough of the uncertainty and asked for a “one-armed economist”. Much is the same today with mega forces pushing and pulling the economy. The net balance will determine whether it is to be a No Mo or Might Mo economy. Continue reading

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Regulation, Gravity and The “Isms”: The Education of a President

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This week, President Obama unveiled his proposals to enhance economic growth, create quality jobs, and create fairness in income distribution an approach he calls growing from the “middle out.” His plans call for income redistribution under the guise of income “fairness” that might reduce differences in income but at a cost of lower income for all. These lessons of the “isms” were learned centuries ago and relearned after the Great Depression but seemly must be relearned again. This will be an expensive education of a President. Continue reading

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A Tiger by the Tail: The Fed and QE3

Federal Reserve metaphors of tapering, exit and de-acceleration are but face saving diversions in the dialogue from the hard fact that this is a requiem not just for QE3 but also a requiem for the idea that the Fed is able to generate further lending and spending. In this new global financing world, stimulus from money had moved to the Shadow Banking System which has reached its upper limit not despite QE3 but because of it. Continue reading

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The Vulnerability of Private Wealth to Government Financial Stress

“The Vulnerability of Private Wealth to Government Financial Stress”
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The Slow-Moving Train Wreck Has Picked up Speed: Foreign Depositors in European Banks Will Be Outed

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Economies have natural self-correction mechanisms to keep the economic train on the tracks and moving at accustomed speed unless undercut by governments. In their desperation for tax revenues, Euro zone governments have “outed” their foreign depositors to the foreigners’ home taxing authority. Thus, the slow moving train wreck has just picked up speed. Continue reading

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Is the Printing Press Engaged for the Duration?

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A printing press is a handy thing to have. When a government or central bank can fund itself with money or claims on money, it can buy a lot of things and solve a host of problems, all without the need to tax. I wish I had one. Continue reading

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Is the Cyprus Bank Fiasco the Template for the Future?

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We are living in profound times. The Great Recession, followed by epic levels of deficit spending sustained by monetary policy, is now having short-term remedial effects on the U.S. economy. But before we declare victory, we need to be clear … Continue reading

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QEs, Currency Wars, the Trillion Dollar Platinum Coin and the Route to “Modern” Inflation

Currency Wars

A government faced with financing its deficits in quantities some multiple of private saving must resort to monetary schemes in order to keep its promises to spend. Monetary schemes are essentially costless ways to pay the government’s bills today while … Continue reading

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America’s Baby Bust By JONATHAN V. LAST

America’s Baby Bust By JONATHAN V. LAST http://online.wsj.com/article/SB10001424127887323375204578270053387770718.html?mod=googlenews_wsj

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The Now Generation Government Has Failed the Marshmallow Test: Making Sense of the Fiscal Cliff Outcome

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Over the past five years, the government has applied the usual demand-side remedies in the epic battle against The Great Recession. The graph shows the time profile of past recessions and recoveries as compared to the Great one that we … Continue reading

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