I was researching what the Modern Monetary Theorists would think about a wealth tax.  It lead me to the New Economic Perspectives article America’s Deceptive 2012 Fiscal Cliff – Part 3.

Why tax the economy at all? And why financial and tax reform should go together.

Taxes pay for the cost of government by withdrawing income from the parties being taxed. From Adam Smith through John Stuart Mill to the Progressive Era, general agreement emerged that the most appropriate taxes should not fall on labor, capital or on sales of basic consumer needs. Such taxes raise the break-even cost of employing labor. In today’s world, FICA wage withholding for Social Security raises the price that employers must pay their work force to maintain living standards and buy the products they produce.

However, these economists singled out one kind of tax that does not increase prices: taxes on the land’s rental value, natural resource rents and monopoly rents. These payments for rent-extraction rights are not a return to “factors of production,” but are privatized levy reflecting privileges that have no ongoing cost of production. They are rentier rake-offs.
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If the rise in real estate prices (mainly site values) had been taxed, there would have been no financial overgrowth, because this price-gain would have been collected as the tax base. The government would not have needed to tax labor either via income tax, FICA wage withholding or consumer sales. And taken in conjunction with the government’s money-creating power, there would have been little need for public debt to grow. Taxing rent extraction privileges thus would minimize debt levels and taxes on the 99%.
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Today’s central financial problem is that the banking system lends mainly for rent extraction opportunities rather than for tangible capital investment and economic growth to raise living standards. To maximize rent, it has lobbied to untax land and natural resources. At issue in today’s tax and financial crisis is thus whether the world is going to have an economy based on progressive industrial democracy or a financialized and polarizing rent-extracting society.

It may take a while to digest this article and separate our preconceived notions.  Also we have to be careful to not confuse the technical term “rent” from our everyday usage.

Wikipedia has the definition of Economic rent.

In economics, economic rent is an analytic term for the portion of income paid to a factor of production in excess of its opportunity cost. Economic rent should not be confused with the more common term rent; a payment for the temporary use of a good or property.

This definition uses some economics terms that require their own definition before you can fully understand the definition of economic rent.  So rather than go down this rat hole, suffice it to say that economic rent is not the same as the rent we think of when we rent an apartment.

The article does call into question the tax payers rebellion against increasing real estate taxes based on the artificially inflated values of said real estate.  Perhaps we tax payers got hit with the unintended consequences of the success of our rebellion.  As usual, we were tricked into rebelling against the wrong people.  We all had visions of getting filthy rich on real estate – especially in places like California – just like many people now think that they might someday be rich like the 1% are.  Instead, with the fall of real estate values from their inflated values, our mortgaged real estate ownership is feeling more like the proverbial albatross around our necks.

Read on to America’s Deceptive 2012 Fiscal Cliff – Part 4.

But the landowning and financial classes fought back, seeking to expunge the central policy conclusion of classical economics: the doctrine that free-lunch economic rent should serve as the tax base for economies seeking to be most efficient and fair. Imbued with academic legitimacy by the University of Chicago (which Upton Sinclair aptly named the University of Standard Oil) the new post-classical economics has adopted Milton Friedman’s motto: “There Is No Such Thing As A Free Lunch” (TINSTAAFL). If it is not seen, it has less likelihood of being taxed.

The political problem faced by rentiers – the “idle rich” siphoning off most of the economy’s gains for themselves – is to convince voters to agree that labor and consumers should be taxed rather than the financial gains of the wealthiest 1%. How long can they defer people from seeing that making interest tax-exempt pushes the government’s budget further into deficit? To free financial wealth and asset-price gains from taxes – while blocking the government from financing its deficits by its own public option for money creation – the academics sponsored by financial lobbyists hijacked monetary theory, fiscal policy and economic theory in general. On seeming grounds of efficiency they claimed that government no longer should regulate Wall Street and its corporate clients. Instead of criticizing rent seeking as in earlier centuries, they depicted government as an oppressive Leviathan for using its power to protect markets from monopolies, crooked drug companies, health insurance companies and predatory finance.

I am just starting to read this part myself.

The Real News Network has the interview they have titled US Backing the Destabilization of Venezuela.  Ok, so maybe the title is a little misleading, but the actual interview is straight forward.  Maybe the US Government isn’t directly involved in the destabalization (the headline never said government), but other forces in the US are probably involved.

Here I quote the bio of the interviewee.

Keane Bhatt is a Washington, D.C.-based activist and writer, and a contributing editor to the North American Congress on Latin America. He has worked in the United States and Latin America on a variety of campaigns related to community development and social justice. His analyses and opinions have appeared in a range of outlets, including NPR.org, The Nation, The St. Petersburg Times, CNN En Español and Al Jazeera. He is the author of the NACLA blog “Manufacturing Contempt,” which critically analyzes the U.S. press and its portrayal of the hemisphere.

I’ll quote just the positive comments about the Venezuelan situation from the interviewee.  I’ll llet you view the interview or read the transcript to swee and hear the other parts.

If you look at unemployment, it’s at a very low point. It’s about, you know, 6 percent. If you look at poverty from 2011 to 2012, Venezuela presided over the sharpest decline in poverty throughout the entire region. So it fell by 19 percent in 2013. Despite the problems of inflation and so on, you have further reductions in the rate of household poverty. So that fell by an entire percentage point over 2013, despite the inflation.

So what you’re seeing is a portrayal of Venezuela as some kind of a chaotic economic basket case. But when you look at a lot of the macroindicators, you’ve had real respectable per capita income growth. Over the past decade it’s been at about 2.7 percent annually. Again, you know, if you look at this historically, poverty has been slashed by half, absolute poverty by 70 percent. The inequality has been reduced so drastically that it’s now the lowest in Latin America.

And to give you a historic perspective, the inflation problems that beset Venezuela now are nothing like the inflation that predates the Chávez era, in which it was much, much higher.

So what you’re seeing is a very distorted and false rendering of what’s taken place in Venezuela during the Chávez years, and even during the Maduro years

If you think only this guy and The Real News Network feel this way about the situation, I have looked up the newspaper story whose image is shown in the video.

The UK Guardian has the story Sorry, Venezuela haters: this economy is not Greece of Latin America.

But how can a government with more than $90bn in oil revenue end up with a balance-of-payments crisis? Well, the answer is: it can’t, and won’t. In 2012 Venezuela had $93.6bn in oil revenues, and total imports in the economy were $59.3bn. The current account was in surplus to the tune of $11bn, or 2.9% of GDP. Interest payments on the public foreign debt, the most important measure of public indebtedness, were just $3.7bn. This government is not going to run out of dollars. The Bank of America’s analysis of Venezuela last month recognised this, and decided as a result that Venezuelan government bonds were a good buy.

On the web page where this article is being displayed are links to other stories from Venezuela that I am going to read. You might also be interested in them.

I think the whole upshot of this post is that, you, too, may be wondering how could Venezuela be having these problems if the Chavez government had not really been nearly as bad as it has been portrayed in the US noise media?  This seems to show that if the US noise media had been deceiving us before, it is quite possible that they are at it again.

If you follow some of the links at The Guardian, the picture gets a little cloudy.

There is the story Venezuela’s poor join protests as turmoil grips Chávez’s revolution.

The poor neighbourhood of Petare in western Caracas is not an obvious hotbed of anti-government sentiment. In the past, its residents have been among the major beneficiaries of Venezuela’s public health and education campaigns, and an economic policy that resulted in one of the sharpest falls in inequality in the world.

But as demonstrations sweep several major cities, even the people of Petare have taken to the streets to protest again surging inflation, alarming murder rates and shortages of essential commodities.

There is also the story Venezuela protests: demonstrators tell us why they’re taking part.

We asked protesters in Venezuela why they have taken part in the anti-government demonstrations. Here is a selection of their views.

If you read the 4 selections, you find that they are all anti-government.  Of course, if these are anti-government protests, that is what you would expect.  (I naively thought that there might be some responses from pro-government demonstrators.)

Of course, we can rationalize either side as being closer to the truth, but we have no real way of knowing.  When the CIA or the powerful multi-national corporations want to foment regime change, they are usually pretty good at covering their tracks or at least having plausible deniability. Still, this observation doesn’t prove anything, one way or another.

To add to the rationalizations, there is a little gem buried in my previous post Why Is The 2008 Crisis Taking So Long To Resolve?

As the Fed has got closer to ending the QE3 and the long-term U.S. rates have edged up, strong downward pressures have started to build up on the currencies, stocks and bonds of several emerging economies such as Brazil, India, South Africa and Turkey, which were widely seen as rising stars only a couple of years ago.

If you follow the trail of where this quote came from and an even older post than that, Tapering of Quantitative Easing Is Throwing Emerging Markets into Chaos, you might see another possibility of the unintended consequences of US policy having very harmful effects on emerging economies. Anyone unaware of this connection could blame the problems on those emerging economies rather than the U.S.

As you read the story of Venezuela’s economic problems, you might want to keep in mind the article from New Economic Perspectives MMT AND EXTERNAL CONSTRAINTS. (MMT is Modern Money Theory.)

To Fix or To Float, that is the question.

MMT argues that a sovereign government that issues its own “nonconvertible” currency cannot become insolvent in terms of its own currency. It cannot be forced into involuntary default on its obligations denominated in its own currency. It can “afford” to buy anything for sale that is priced in its own currency. It might be able to buy things for sale in foreign currency by offering up its own currency in exchange—but that is not certain.

If, instead, it promises to convert its currency at a fixed price to something else (gold, foreign currency) then it might not be able to keep that promise. Insolvency and involuntary default become possible.

As I read the story of Venezuela, I think it looks like Venezuela has tried to fix their currency rather than float it.  They may be learning that they just cannot do that.

I received this email from one of the candidates for Tantasqua School Committee.  Since he does such a great job of speaking for himself, I am not going to add anything more.

 

——– Original Message ——–

Subject:	It’s A Race!
Date:	Mon, 24 Feb 2014 11:04:56 -0500
From:	Jacob Ryan <jacobjamesryan@gmail.com>
To:	Steve Greenberg

Hello Everyone!

I wanted to take a moment to message you all and talk about why I got so involved in Politics and why I am running for the Tantasqua School Committee.

I first got involved in politics at the age of 13. I had grown up until that time with a conservative point of view due to the church I attended, and it wasn’t till Hillary Clinton ran for president that I started to identify as a Democrat. After that loss and Barack Obama’s win in 2008, I began to get deeply involved in races. My first internship at a campaign was back in 2010 in Congressman Neal’s campaign office. I learned at that time how important it is to organize locally to help your candidates win elections and make sure the beliefs you hold deep in your core win as well.

With his re-election complete, I was eager to get involved in more campaigns. In 2011, I got involved with and interned for Elizabeth Warren. Never had there been a time that I had been more devoted to a candidate then when I interned for her. And the night that she won her election to represent the Commonwealth in the Senate, I bawled my eyes out. I continued to cry with Barack Obama’s re-election as well. By this time I knew how to campaign, but I still had much to learn.

I got more involved in town politics in June of 2013. I went to my first town meeting and was very attentive to the issues at hand. One issue in particular caught my attention, Stipends. The BOS had tried to pass stipends for certain elected and appointed officials in the town at the last minute during the budgetary season and the folks at town meeting were deeply opposed. I at the time wasn’t sure about the issue and wanted to have more time to learn about it. So I voted no to the proposal. Then when the town moderator had brought up the idea of a study committee being formed to study the issue of stipends, I was proud to make the motion to create this committee.

With the creation of this committee, I had asked the town moderator to appoint me to be one of the two citizen appointees. When I got the letter from him stating that he was going to appoint me, I was very humbled that he was giving me the opportunity to serve my community. I had the honor of working with some great folks on that committee who really did have the community’s best interest at heart. I was chosen by the committee to be the chair, again a very humbling experience for me. As time had gone on I had grown more opposed to stipends but was able to put those beliefs aside to work with those who I may not agree with to come up with a plan for the voters at town meeting to decide. I found it easier to work with those I may not agree with when I really looked at them as fellow members of the community who cared about the town as well.

With the success of compromise and non-partisanship that this committee showed could happen I was saddened to see how much town politics had devolved to spiteful, hateful speech. And I couldn’t stand by and watch it happen anymore. With the Stipend Study Committee coming to a close and my belief that we needed someone in the community that could work with everyone (no matter their political stripes) I decided to run for local office.

I decided that I wanted to give back to the part of the community that had given so much to me, Tantasqua. I graduated in 2013 with my diploma and CNA certification in hand and was able to do something a lot of students coming out of high school have a had a hard time doing, get a job.

Thanks to Tantasqua’s wonderful vocational program I was able to get a job with good job security during a time of economic hardship. When I was in high school I had the opportunity to serve as the Technical Student Representative on the School committee and really loved praising our vocational program to the committee. My brother is currently enrolled in the computer tech program at the high school and is ahead of his class in getting his certifications. I couldn’t be more proud of him. I want to work with those on the committee and in town to help preserve this great asset to our children. These programs give such a valuable opportunity to our students and should be protected.

I also want to serve as a bridge-builder on the committee. As proved by my time on the stipend study committee, compromise and non-partisanship can be reached but it requires patience and the understanding that those you agree and disagree with are only doing what they think is best for the school and community. With that in mind, I promise to work with my fellow committee members to do what is best for our community and to build bridges not only for us to work with each other on but to allow our next generation to cross those bridges into the next part of their lives.

I am proud to welcome Patricia Barnicle and Ms. Tichy to the race and wish them the best of luck.

I ask for your support because I care deeply about our community and school system and want to make sure the same opportunities that were presented to me are still there for upcoming generation.

Thank You!

Jacob J. Ryan

 

 

Progressive Massachusetts has created an endorsement questionnaire for candidates running fo the offices of Governor, Lieutenant Governor, Treasurer, and Attorney General.

We asked all democratic and independent candidates for contested statewide offices to submit questionnaires to be considered for our endorsement. As you vet the candidates and study their platforms, use our questionnaires to find out where candidates stand on specific policies that will move our state toward greater economic justice and a renewed, shared prosperity.

On the Progreesive Massachusetts‘ web page there are links to the responses of candidates for all four of the offices.  Here is the link to 2014 Governor’s Race OMNIBUS PROGRESSIVE MASSACHUSETTS ENDORSEMENT QUESTIONNAIRE RESPONSES.

It is going to be tough to decide on who to choose from this excellent field of candidates.  We should always be lucky enough to face this “problem”.  I hope they don’t get into a mudslinging contest. Such a contest might spoil the chances of enlisting the expertise of the non-winners in the next Governor’s administration.

The Maddow Blog has the post Why actual ACA ‘victims’ are so elusive.

Michael Hiltzik speculated last week that there may not be any genuine anecdotes to bolster the right’s claims.
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To a very real degree, it’s tragic to watch the developments unfold in real time. For much of 2013, especially in the months leading up to the open-enrollment period, assorted far-right groups launched an organized campaign to encourage the uninsured to stay that way – on purpose – in order to help conservative organizations advance their ideological agenda. It was a truly offensive display in which wealthy activists on the right urged struggling Americans to deliberately put their wellbeing in jeopardy.

Months later, we’re at a similarly painful moment in the debate, in which many of the same groups and activists are now exploiting people to create misleading attack ads, all in the hopes of keeping people from having access to affordable health care.

Quoting Paul Krugman, the post has the following:

Surely there must be some people somewhere actually being hurt by a reform that affects millions of Americans. Why can’t the right find these people and exploit them?

If and when someone actually does find someone hurt by the ACA, nobody is going to believe it because of all the phony stories that preceded it.

New Economic Perspectives has the Joe Firestone article How to Restore the Good Name of Government.

Nor will they legislate anything useful after it unless 1) Democrats get a majority in both Houses and 2) Democrats who constitute those majorities are willing to move away from corporatism and legislate in the interests of people. So, if something can be done in this area, it must be done by the President. There are four very important things he can do before the elections of 2014 that would help to restore some faith in Government and, as a by-product, at least tentative trust in the possibility that renewed Government deficit spending may help people.

1. The President can re-institute the rule of law in the area of national security and secrecy by ending mass surveillance of the US population immediately, ceasing all investigations and attempts at prosecutions of journalists who have been trying to tell the public about the overreach of our intelligence agencies, beginning investigations and prosecutions of intelligence operatives who have broken existing laws in gathering intelligence, ending current prosecutions of whistle blowers, and issuing pardons for those who already have been tried, convicted, and jailed.

2. The President can re-institute the rule of law in the area of FIRE sector control and mortgage frauds by beginning investigations and prosecutions of high level executives at too big to fail FIRE sector organizations who have committed fraud including those that caused the financial collapse of 2008, which, in turn, led to the Great Recession and the destruction of so much middle class wealth.

These first two initiatives are supremely important because they will deliver a very visible presidential message that the Government is re-instituting honest government and a single system of law, which, in turn, will give people some reason to believe that renewed spending by the Government will be carried out honestly for the benefit of people, and not for the benefit of FIRE, health care, energy and other elite corporations.

I leave it to you to read the other two things that can be done.

I chose to respond to the following statement from the article:

Finally, these Democratic promises will surely be met with a campaign emphasizing the bogeyman of hyperinflation. Democratic promises will be estimated in a primitive way totaling up what will they cost over the two year period. The assumption will be made that they won’t be countered by automatic stabilizers producing increasing fiscal drag as the US approaches full recovery.

The trouble with the cut in tax rates during the Reagan/Bush/Bush era is that it severely weakened the automatic stabilizers that prevent inflation from happening when the economy is in full recovery.  A marginal tax rate of 80% to 90% then in effect is a far cry from top rate in the 30’s that is now prevailing.  If we cannot get these tax rates restored now, then when inflation comes along, the stabilizers won’t be automatic.  They will require legislation that takes a long time to get approved at just the time when they need to immediately and gradually start kicking in before inflation can take hold.

There is a real reason to have high nominal tax rates with loopholes that kick in in times of recession.  Nobody is explaining this to people.  When the Republicans emphasize the high nominal corporate tax rates compared to other countries, the Democrats only explain that the effective tax rate is actually very low.  They never explain why this method is advantageous.  So you get all these calls to simplify the tax system with no explanation of what would be lost if we enact some of the simplifications.

There are probably very few politicians that even think about this and would be in a situation to provide an explanation.

New Economics Perspectives has the William Black post If New York Times Reporters Won’t Read Krugman about Austerity Will they Read Brooks?

I have written repeatedly about the New York Times’ needs to create a prize in incompetence in macroeconomic reporting (IMR) and suggested that the paper award the IMR prize to its reporters.  I suggested that the prize consist of a two hour lunch with Paul Krugman in which he will provide them with a remedial lecture on why austerity is an economically illiterate response to a recession.

I dedicate the above link to all who hold The New York Times in such high regard for their honesty in reporting all the news that fits in print.

To bolster my confirmation bias in what stories I choose to emphasize, Black goes on to say,

Notice that Shear treats the “looming debt crisis” and desirability of deficit reduction as facts so obviously true that they require no analysis.  There is no “looming debt crisis” for the U.S. government and the deficit has been reduced too quickly.  Notice that Shear implicitly treats federal budget deficits as harmful.  There are circumstances where that could be true due to inflation and very high capacity utilization.  We are not remotely in those circumstances.

I have emphasized the last two sentences, so that people won’t try to raise the false argument about inflation and crowding out private investment.  To get what Bill Black and I are saying, refer to the video below.

For everything there is a season, and this is not the season for austerity. Could it be more plain?

The Daily Kos has the story Exxon CEO Joins Lawsuit to Stop Fracking Near His Home.

Exxon CEO Rex Tillerson may be the world’s biggest fracker (Exxon is the biggest natural gas producer in the U.S.) but he isn’t stupid. He’ll frack my backyard and tell me it’s good for me and he’ll frack your place too, but don’t let any frackers near his home. He knows damn well that fracking lowers property values, but he wouldn’t admit it until the frackers came to his place. He just joined a lawsuit to stop the fracking because it would lower the value of his property.

Well, if you read the story on which The Daily Kos article is commenting, the path from the lawsuit to fracking is not quite as direct as the comment would imply.  However, “it is close enough for government work” as we used to say in the Army.

The step between the lawsuit and the fracking is really a pretty thin veil, in my opinion as well as the opinion of the article.

I don’t know who is being quoted here, but this shows you the indirection used.

Tillerson has joined a lawsuit that cites fracking’s consequences in order to block the construction of a 160-foot water tower next to his and his wife’s Texas home.

The Wall Street Journal reports the tower would supply water to a nearby fracking site, and the plaintiffs argue the project would cause too much noise and traffic from hauling the water from the tower to the drilling site.

If noise and traffic is a legitimate cause for legal action, you would think that poisoning wells and causing earthquakes would be legitimate causes for action, too.  Poisoned wells and earthquakes are the more typical reasons for objecting to fracking.

Motherboard has the article The Math That Predicted the Revolutions Sweeping the Globe Right Now.

Just over a year ago, complex systems theorists at the New England Complex Systems Institute warned us that if food prices continued to climb, so too would the likelihood that there would be riots across the globe. Sure enough, we’re seeing them now. The paper’s author, Yaneer Bar-Yam, charted the rise in the FAO food price index—a measure the UN uses to map the cost of food over time—and found that whenever it rose above 210, riots broke out worldwide. It happened in 2008 after the economic collapse, and again in 2011, when a Tunisian street vendor who could no longer feed his family set himself on fire in protest.

To judge this article, it helps to know the definition of the Food Price Index.

The FAO (Food and Agriculture Organization of the United Nations) Food Price Index is a measure of the monthly change in international prices of a basket of food commodities. It is not a measure of the height of food prices, but it is a measure of how quickly the prices change.

I have been wondering what it takes to drive people to start the kind of uprising that can overthrow a government.  This article provides an answer that I had not thought about.  I doubt the Republicans know what fire they are playing with when they cut back on food stamps in this country.  Should we tell them, or should we let them dig themselves a hole they will never get out of?  If it weren’t for the suffering of the people who cannot afford to buy food for their families, the answer to the previous question would be more obvious.

The Real News Network has the interview Why Is The 2008 Crisis Taking So Long To Resolve?

Economist Yilmaz Akyüz on how excessive reliance on the US Federal Reserve created more problems than it has solved

Here is an excerpt to get you started.

AKYÜZ: The top 1 percent actually got the entire increase in income in the United States since 2009. And, in fact, the share of the rest of the population has been falling. So inequality is increasing in Europe too because of the austerity policies. So we have actually [incompr.] a bigger deflationary gap, because the workers are unable to afford the goods and services they are producing.

Now, how are we going to grow again brings you to the fundamental problem. Are we going back to business as usual? That means we’re going to have debt-driven bubbles in the United States or in Europe, or we’re going to be stuck in a long stagnation

FRIES: And what other policy shortcomings do you see in the U.S. and Europe post-crisis?

AKYÜZ: Well, one problem I mentioned in the crisis intervention was fiscal austerity after the initial expansion. A second shock coming in the policy response was actually the inability, and, in fact, unwillingness, of the governments to remove debt overhang by timely, orderly, and comprehensive debt restructuring.

Some people have had trouble understanding the interviewee. If you have such trouble, you might want to read the transcript at The Real News Network web site.

The paper that the interviewee discusses in this video is The Uncertain Future of the World Economy.

The world economy suffers from an under-consumption bias because of low and declining share of wages in the gross domestic product (GDP) in all major advanced economies including the U.S., Germany and Japan, as well as China.

Still, until 2008-2009 the threat of global deflation was avoided thanks to consumption binges and property booms driven by credit and asset bubbles, particularly in the U.S. and the European periphery.

The crisis has not removed but reallocated global trade imbalances.

Longer-term global prospects depend a lot on the U.S. due to its central position in the world economy and the international reserves system. It is highly unlikely that the U.S. can move to wage-led growth in the near future.

The end of this short paper speaks about an issue for the emerging economies.

The normalisation of monetary policy in the U.S. will also cause problems for emerging economies. Despite occasional complaints about the “currency war” entailed by liquidity expansion in several major advanced economies simultaneously, the policy of ultra-easy money has generally been benign for emerging economies.

It has been a major factor in the sharp recovery of capital inflows after the sudden stop caused by the Lehman Bank collapse in September 2008.

Many major emerging economies such as India, Brazil, South Africa and Turkey have come to depend on such inflows as their current accounts started to deteriorate. They have invariably welcomed the asset bubbles that such inflows have helped generate and often ignored the financial fragilities caused by increased exposure to interest rate and exchange rate risks by private borrowers abroad.

Such exposures are on the rise since the beginning of 2012. As funds have started to be withdrawn from domestic securities markets, emerging economies have increasingly relied on international debt contracted in reserve currencies, which reached, in net amounts, 600 billion dollars between the beginning of 2012 and mid-2013.

As the Fed has got closer to ending the QE3 and the long-term U.S. rates have edged up, strong downward pressures have started to build up on the currencies, stocks and bonds of several emerging economies such as Brazil, India, South Africa and Turkey, which were widely seen as rising stars only a couple of years ago.

And the longer-term prospects of the eurozone are even less encouraging than the situation in the U.S. Deleveraging and recovery are likely to remain extremely slow in the periphery and many countries cannot expect to recuperate the output losses incurred after 2008 for several years to come.

This explanation answers some of the questions I had about an interview featured in a previous post Tapering of Quantitative Easing Is Throwing Emerging Markets into Chaos.

February 23, 2014

Part 2 has been published – Wage Shares Fall in the US, Germany and Many Other Countries While Financial Shocks Hit Emerging Economies