Europe is at a crossroads of slow economic growth from a post war period of regulation and high taxes and the creation of a new growing underclass of immigrants that are not being absorbed. Avoiding the ensuing financial, social and political costs is unimaginable. England embraced Brexit for several reasons; most often stated was the loss of sovereignty and control of their destiny. They may simply be the first to leave a sinking ship.
Read MoreThere is a mismatch between countries with stable financial structures and countries with great growth opportunities. Emerging nations have more room to grow but business owners in third world and some second world countries prefer to hold their cash in more stable economies increasing the supply of cash.
Read More” Contrary to a widespread impression among noneconomists, though, understanding the vocabulary of economics is not the same as understanding economics.”
Read MoreThe prioritization of inequality over poverty is attributed to envy in some cases but more often to a violation of some sense of fairness. But just as we should care not the think of the poor as a single entity, we should be even more cautious not to group the rich or even the super-rich as a single faceless group. Some of the super wealthy have benefited us all, and some have abused the system to their advantage while providing little value. We should distinguish between the rent seekers and the rich who have improved our lives.
Read MoreClass warfare as political policy negates the need to articulate limits, acknowledge tradeoffs, understand the process of wealth creation, or do real math that measures and acknowledges real costs and revenues.
Read MoreDescriptive powers do not naturally unfold into predictive accuracy. Models by their nature must eliminate variables that can be critical. An economy as large and as dynamic as ours is a wonderful and complicated thing and not cooperative to descriptions and predictions according to simple models.
Read More“The best case for capitalism is a case for markets as one crucial set of institutions in a free society deeply rooted in the West’s liberal and pre-liberal soil. It is crucial because at its best it protects every man’s right to the fruits of his labor, encourages virtues crucial to living free, and has proven unbeatably capable of improving everyone’s living standards. But it must remain rooted, because man does not live by bread alone, and because both the market and the larger society depend upon other formative institutions that help us all become better human beings and citizens.”
Read MoreAdvocates of single payer and free benefits prove to be ignorant of the price system, profit, productivity and how they function. While they claim to allocate resources better than the ‘greed’ of the market (a claim easy to totally refute), they are clueless on how the wealth is generated in the first place.
Read MoreThey likely do not recognize the legitimacy of individual ideas as property. For them it is not theft, it is a stark difference in political culture. Trump may think he is seeking simple economic fairness, but he is really asking for China to change its civic culture. This is a challenging reconciliation.
Read More“How delicious that, as we approach the bicentenary of his birth, Karl Marx should have turned into the thing he loathed above all: the prophet of an irrational faith.”
Read More“Humans make hierarchies of status and privilege for themselves whenever the opportunity avails itself. This is why all socialist systems that do not work within the constraints of a liberal democratic framework of the rule of law inevitably descend into tyrannies. Give the state unbridled power, and the denizens of the state will use that power toward their own ends.”
Read More“When a politician declares a “right” in a scarce good, it indicates either that he is a simpleton or that he believes you to be, and one’s as good as the other, that being another defect in democracy.”
Read MoreIf you prioritize economic growth over social spending, you will have a great measure of both: if you prioritize social spending over growth you will have less of both.
Read MoreTypically, the economy rebounds sharply after a deep recession like 2008. The slow growth experienced could have shown a delayed effect unleashed by the Trump election. The market may have been cheering more for the removal of impediments to growth than it was to the prospect of tax cuts and deregulation. Emerging from a long period of slow growth may have the same effect as emerging from a deep recession.
Read MoreWilliam Trufant Foster, a former college president, and Waddill Catchings, an industrialist and financier wrote Profits in 1925 and The Road to Plenty in 1928. A decade before Keynes these amateur economists challenged the fundamental principle of Say’s Law that production generates its own supply. They reversed the principle to ‘consumption drives production.’
Read MoreCompetition is both wasteful and efficient. Lots of ideas die, but the new ones that emerge more than make up for the loss. Central planning may restrict competitive ideas, but rarely leads to the emergence of great ideas because central planning is reacting to problems and needs that become obsolete before the ink is dry on the plan.
Read MoreKeynes suggested the use of government to make more efficient allocations of capital but was often critical of the incompetence of government officials. He seems to unknowingly refute himself. The weak accountability in government action is what distinguishes it from market solutions. The worst solution is the pairing of select firms to partner with government actors. When the results fail capitalism is faulted, bur corporatism is not capitalism.
Read MoreThe tariffs and the growing debt are threats, but bull markets do not require perfection. They just require sound fundamentals and a dearth of alternative investments.
Read More“What can’t be stressed enough about what happened in 2008 is that for economies to grow and markets to rise, it’s necessary that the mediocre and lousy constantly be replaced by the good and brilliant. “
Read MoreWarren shows no understanding of what profit is. It is the signal that determines the best allocation of resources. The better ideas attract the most capital through the profit incentive. Profit is a byproduct of innovation and ideas. Ms. Warren would substitute this with a government bureaucracy who will determine the proper allocation of resources. The would not only squelch economic growth and innovation, it would increase corruption exponentially as businesses curried political rather than consumer approval. Startups would head overseas.
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