Sunday, November 15, 2015

Some weekend news

Well, the tests are done-ish. I got 30/30 in stats, and 29/30 in micro; dunno what my macro mark is yet but the 10-mark written question was just a silly "here's a formula, let's see if you can substitute the values and realize that IS-LM is supposed to be in equilibrium" type thing. I got that one perfect, but there were a lot of theoretical LM curve questions that I could have gotten wrong.

But now I have a 10-page PoliSci essay due Wednesday night, which I'm doing on a postmodernist reinterpretation of Huntington's "Clash of Civilizations" thesis. So work continues all this week. Then there's yet another goddamn stats test on Saturday, and there's actual stats on this one.

But in the meantime, here's some news to tide you over:

New Deal Demoncrat - weekly indicators. Year-over-year numbers include mortgage purchase applications +18%, real estate loans +6.2%, real M1 +5.5%, real M2 +6.2%, tax withholding +7.2%, gasoline usage +3.3%, GS consumer spending +3.2%. How is that consistent with anything but a continued expansion?

Calculated Risk - US prime working-age population growing again. Demographics trump bullshit, so quit piddling your panties and buy the US.

Jeffrey Kleintop - what earnings are telling us about the economy. Even that permadoomer clown Kleintop has begun to admit that everything's fine in the US.

WSJ RTE - US inventory buildup. It's bad if it's happening. However, Michael Shaoul says inventories are being drawn down, and I trust him more than the WSJ to know the difference between forward and lagging indicators.

John Cochrane - on permazero. He's chuffed that Jim Bullard from the St. Louis Fed gave a presentation (pdf) based on one of his papers. And Cochrane brings up an interesting point:
Just what is so terrible about zero rates and very low inflation? Zero rates are the optimum quantity of money. They have financial stability benefits too. Banks sitting on huge piles of cash don't go under.

Conventional modeling has been treating the zero bound as a "trap," or a terrible outcome to be avoided. But it's a honey trap, at least in these models.
You've spent decades teaching undergrads that inflation is bad. Well, now you're going to have zero inflation forever. Isn't that what you wanted, economics profession?

He also notes that long-term growth is still supposed to be based on capital investment and productivity, not on anything monetary. So you can't blame zero growth on zero rates and still hew to classical economic theory.

Conversable Economist - what are Uber's real economic gains? Fucking simple. Traditional taxi systems confiscate a tremendous amount of wealth by generating extreme scarcity, while Uber maximizes consumer surplus by forcing the market into perfect competition. Sorry guys, but there are a million poor people in metro Toronto who need reliable transportation: their welfare is more important than 200 rich Sikhs with plate monopolies.

Jojo - USD breakout could unleash capitulation in PMs. Well, now Jojo's calling for sub-$1000 gold.

The Krugginator - Republicans' lust for gold. Hey, I've got another theory, dude. Maybe all the Republican candidates are paid propaganda stooges of Vladimir Putin and the FSB, like Ron Paul is. That would explain why they're all talking up gold.

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