Mar 182015
 
Managed depression

Why are interest rates so low? The best answer, says Martin Wolf, principal economics columnist of the Financial Times, is that the globe’s advanced economies remain in a “managed depression.” This is the phenomenon that former U.S. Treasury Secretary Lawrence Summers has in mind when he writes and speaks about [continue reading . . . ]






May 122014
 
Income inequality illustrated

For a presentation May 8 to the Washington Alaska Chapter of the Healthcare Financial Management Association, I added to my talk a few comments on income inequality. It is not hard to find ways of illustrating growing income inequality in the United States and elsewhere. Here a few slides prepared [continue reading . . . ]






Jul 232013
 

The ports of Seattle and Tacoma are both spending heavily gearing up for shipping-container volumes vastly beyond anything they’ve handled to date. They both may be chasing pipe dreams that will prove costly to their taxpayers. Data from the Pacific Maritime Association shows that container “handle” at Tacoma peaked eight [continue reading . . . ]






Jul 152013
 

I was a newspaperman before I became, in order, a newsletter editor-publisher, then a self-trained economist and professional speaker. I still love newspapers. And not just the on-line versions. I still savor dead trees. Four newspapers thud on to my front porch on weekdays, five on Saturdays, two on Sundays. [continue reading . . . ]






Jun 222013
 

We have not seen this movie before. We do not know how it ends. Unwinding the Fed’s Quantitative Easing (QE) programs and central banks’ near-zero interest policies (N-ZIRP), now in Year 5, were never going to be easy. But these have to be done eventually. The repression of interest rates [continue reading . . . ]






Mar 272013
 

A correspondent who heard my comments on Cyprus on KUOW’s Weekday program today asks: I am puzzled by some of your comments this morning. As I understand it, when a bank in the U.S. fails, the FDIC moves in and closes it. The accounts are protected by insurance up to [continue reading . . . ]






Jan 112013
 

My friend James McCusker, tongue planted firmly in cheek, suggests that rather than just one trillion-dollar platinum coin as a solution to our debt-deficit-fiscal mess, we mint one worth $50,000 for each of us. That’s roughly 315 million shiny tokens. Poof! Our debt problem goes away. How do you plan [continue reading . . . ]






Dec 122012
 
Printing more will do what, exactly?

So we have just started Year 5 of N-ZIRP, the Fed’s near-zero-interest-rate policy, and it is working so well that the Fed will have to keep printing money. What’s wrong with this picture? In fact, despite a massive expansion of the Fed’s balance sheet, and some of the lowest interest [continue reading . . . ]






Sep 172012
 
QE and financial repression

Say what you please about Ben Bernanke’s unconventional monetary policies (quantitative easing, QE for short, and Operation Twist), they’ve been good for the stock market. The first chart shows that stock prices have roughly doubled, give or take a few percentage points, since Dr. Ben launched the first round of [continue reading . . . ]






Sep 042012
 

Fix Medicare, primarily by restricting end-of-life care, as insurance companies do now. Fix Social Security by minor changes to (1) the payroll tax, (2) the benefit formula for high-income beneficiaries and (3) the retirement age. Fix the hopeless hairball that is the U.S. tax code primarily by (1) broadening the [continue reading . . . ]






Jun 052012
 

Martin Wolf, much-honored chief economics commentator of the Financial Times, has been my beacon during the financial crisis. So it is especially discouraging to read his June 6, 2012, column, headlined “Panic has become all too rational”. Wolf argues that the advanced economies are caught in a “contained depression,” that [continue reading . . . ]