Recent Posts

Monday, January 25, 2021

Writing Update...

Just a short update. I have passed on my MMT primer manuscript to my editor, and am now looking forward to what is next on my plate. I relaxed a bit over the holidays, had some other projects and distractions, and puttered around trying to get my manuscript to be line with potential policy changes courtesy of American political shifts. 

The publication timeline is still vague, dependent upon how many gallons of red ink my editor needs. The paperback layout should be faster this time, since I got rid of footnotes/endnotes.

I am about to write up some comments on yield curves. After that, I am returning to the second volume on recessions, as well as starting to think more about inflation theory. (After Recessions Vol II, my plan is to do either inflation or fiscal policy/recessions.)

Thursday, January 21, 2021

Minimum Wage Effect At The National Level

The possibility of an increase in the minimum wage at the Federal level of the United States is an extremely interesting reform. By itself, I am unconvinced about its macro significance (for reasons to be discussed herein). However, if part of a slate of policies aimed to run the economy hotter, it could be one potential component of a hypothetical structural shift.

Tuesday, January 19, 2021

Political Posturing

There has always been considerable hyperbole about American elections -- "the most important election since 1920!" or some such. Conversely, from the perspective of economic institutions, it is hard to see any fundamental changes since the early 1990s. Up until earlier this month, my base case was that the Biden administration would be replay of the Obama one. However, one can see a story where things have fundamentally changed.

Thursday, January 14, 2021

Treasury Sell-Off Following Past Patterns

Figure: 10-Year Treasury, 2/10 Slope

The sell-off in the Treasury market is following the footsteps of other mini-bear markets that have happened at the tail end of recessions. Barring some economic fireworks, it is entirely likely that yields will enter range-trading mode. For now, the question remains as to what levels the bear phase stalls out at. 

Sunday, January 10, 2021

The Implausibility Of The Chapwood Index

The Chapwood Index has become a popular source to cite by hard money proponents who are pushing the line that inflation is really much higher than what government statisticians suggest. It has taken over the limelight from Shadowstats, which pioneered pushing that particular line. Although it is entirely expected that individuals can face cost of living increases that rise faster than official the CPI inflation rate, the levels of inflation suggested by the Chapwood Index do not appear to offer any plausible information about the price level as the concept is used into macroeconomics.

Monday, January 4, 2021

Transfers And Overheating

Figure: Core Inflation, U.S. and Canada

A recent controversy that erupted was the question as to whether transfer payments (such as the $2000 transfer that was debated in the United States) would cause the economy to overheat. There is an interesting issue: even if $2000 is not enough, what about larger amounts? I have severe doubts that anyone could give a useful answer to what appears to be a simple quantitative question, without a country pushing the envelope for the sake of an economic experiment.

Wednesday, December 23, 2020

Happy Holidays!

Happy Holidays to you and yours! I will probably be offline until early January.