Deflation?

Occasionally, those not trained specifically in economics produce commentary that fires one to think.

I have been formally trained in economics and economic history, which is perhaps a disadvantage if discussing economics with Mish.

Mish has an excellent grasp of the issues and his ideas are not to be disregarded because they are not conventional.  Perhaps, insights coming from a wide breadth of reading qualify one more than the passing of exams. Well done, Mish.  You are a man to read:

http://www.businessinsider.com/mike-mish-shedlock-10-2010

http://globaleconomicanalysis.blogspot.com/2007/06/misconceptions-about-gold.html

http://globaleconomicanalysis.blogspot.com/2007/06/why-does-fiat-money-seemingly-work.html

http://globaleconomicanalysis.blogspot.com/2010/10/double-dip-delayed-not-derailed.html

Will not time reveal the lasting importance of friends and mutual respect?   Be kind to those who think well of you and those you know and try to add positive elements to your world.   Promote peace in your heart and sunshine in the minds of those around you by your own good works.    Elevate the level of discussion by thinking less of the issues and more of how you can reduce the tension of stress that arises with honest disagreement.   Relax by breathing more deeply and consciously.     

     

Do you view current approaches to big banks as the way to go?

What are the alternatives to bank bailouts?

http://www.businessinsider.com/mike-mish-shedlock-10-2010

How far will people go?

http://www.businessinsider.com/anti-bank-bailout-revolution-2010-10

Will not time reveal the lasting importance of friends and mutual respect? Be kind to those who think well of you and those you know and try to add positive elements to your world. Promote peace in your heart and sunshine in the minds of those around you by your own good works. Elevate the level of discussion by thinking less of the issues and more of how you can reduce the tension of stress that arises with honest disagreement. Relax by breathing more deeply and consciously.

iPad Popularity is Not the Only Factor in Sales Growth

Supplies of components are improving!

http://www.eetimes.com/electronics-news/4209821/ISuppli-again-boosts-iPad-sales-forecast

Will not time reveal the lasting importance of friends and mutual respect? Be kind to those who think well of you and those you know and try to add positive elements to your world. Promote peace in your heart and sunshine in the minds of those around you by your own good works. Elevate the level of discussion by thinking less of the issues and more of how you can reduce the tension of stress that arises with honest disagreement. Relax by breathing more deeply and consciously.

Why Keynes Would Agree With The Idea of Government Supported Investment at Home

In Keyne's day, the structure of economies was very different from what it is today. His emphasis on short term investment to get job numbers up was speculative to say the least. New investment could introduce new technology that would spur on efficiency of labour and reduce employment numbers. Schumpeter the economic historian understood what Keynes did not understand and that was the real dynamic of the business cycle within an economy that's evolving. However, put Keynes and Schumpeter together and you get a better perspective of what new investment might do. You also see where US economic policies fight each other. One is that America wants jobs, but has implemented policies that encourage unemployment and inefficiency.

The reason is that economists designing American policies are not very skilled in applying all the economic sciences together in an integrated fashion. They produce piecemeal policies that an economic historian would regard as ludicrous. Too many investment ideas don't mix macro and micro economic concepts very well or neglect non linear economic dynamics and product mix evolution. Bad understanding of economics leads to ineffective policy and huge mistakes in macroeconomic management such as we have seen. Business schools, economics departments, and economic history departments are just that separate schools of practice and thought leading to a mishmash of weirdness and inconsistency.

Spending on new equipment will help growth in a domestic context such as the United States in the modern context because of the shift of employment to other economies. It is extremely important to reduce the cost of capital investment in an advanced economy competing with a labour rich economy. Get rid of the taxes on investment in the United States and growth will result and it will be in keeping with the ideas of the great economists. Reduce capital gains taxes in advanced economies in order to slow down the export of jobs to labour rich economies.

The cost will be greater economies of scale rising in advanced economies and more employment in the labour rich economies. The source of growth in an advanced economy that has skilled labour must be investment in capital that can use that labour and achieve efficiencies.

To encourage investment in equipment, and to create jobs in an advanced economy, it is not a good idea to have a weak exchange rate as that will encourage inefficiencies of all forms and the export of efficient manufacturing to other countries.

Will not time reveal the lasting importance of friends and mutual respect? Be kind to those who think well of you and those you know and try to add positive elements to your world. Promote peace in your heart and sunshine in the minds of those around you by your own good works. Elevate the level of discussion by thinking less of the issues and more of how you can reduce the tension of stress that arises with honest disagreement. Relax by breathing more deeply and consciously.

Why Do Good Economists Disagree?

It's very confusing that the social scientists occupy a world of knowledge that seems far less secure than the world of knowledge occupied by the physical scientists. The social sciences, such as economics, are not so different in reliability.

What people fail to understand is that a social science discovery has a sell-by and use-by date that comes much sooner than that of the physical sciences because the number of variables is much larger. Not only that, but the world of the social sciences is non linear and few economists can explain their thinking to audiences unskilled in non linear thought. The world thinks in a linear way despite the fact that almost everything in the social world happens in a non linear way. Dah! Most social science stuff is too difficult for the man in the street to understand consciously, but unconsciously there may be hope.

Similarly, a good social science non linear law lasts for a very short period, while a good physical science non linear law lasts almost endlessly. Look at chaos mathematics and ask how you convey the truths of that to the broad public. By the time a social science law is discovered the social world has gone, but by the time a physical law is discovered the world will be able to use it for a while.

Thus, when you read an economist's views you need to assess how long the views, even if correct, will last, probably not much longer than a good weather forecast made a week in advance of the weather. That weather forecasts are much better is quite evident, but this is probabilistic. They are more probably better, but not certainly better. The sell-by dates for an economist's views are fairly short, so one has to be very careful when using them. Some economist's views are stale the moment they are spoken, being based on other economist views, which are stale. Most economists views are stale and it is difficult to find fresh ones, but when you do, they are very very usable.

http://online.wsj.com/article/SB10001424052702303284604575582240138889912.html?mod=WSJ_economy_LeftTopHighlights

http://www.washingtonpost.com/wp-dyn/content/article/2010/10/29/AR2010102900598.html?wpisrc=nl_natlalert

Will not time reveal the lasting importance of friends and mutual respect? Be kind to those who think well of you and those you know and try to add positive elements to your world. Promote peace in your heart and sunshine in the minds of those around you by your own good works. Elevate the level of discussion by thinking less of the issues and more of how you can reduce the tension of stress that arises with honest disagreement. Relax by breathing more deeply and consciously.

We Make A Mistake If We Ignore History And Why We Should Not Ignore Milton Friedman on Money

Too much money all at once and you get inflation? Well, the evidence suggests that money is the main source of inflationary impulse. Actually, we may not get inflation because we may be increasing money at a time of growth and the growth may require more money. The problem is that if we do not know when growth will occur, we do not know when we should have more money. It's not a question of Keynes versus Friedman. It's a question of the economics of short run expectations and risk against long term prudence and hedging. Keynes was a risk taker as we see from his speculation at Cambridge in commodities. Friedman was a hedger who knew that too much money at the wrong time produced real social problems down the road.

We have seen the inflation and now we are seeing more risk taking should the growth that we all want to see not happen. Well, the reality's that the world is growing and it needs dollars because dollars are the only world currency apart from gold and SDRs. That SDRs get translated into dollars at some point is self evident and that SDRs as dollars are hot money is risky. Should however the dollars produce a bout of commodity inflation similar to what happened in the 1970s, we would have real problems.

The risk is real that we will see a race to commodities out of dollars and should that happen we will get out our Milton Friedman papers and understand that he said that he told us so. What are you in favor of inflation as a risk or growth. Chances are that it is the weaker advanced economies that will suffer most!

http://online.wsj.com/article/SB10001424052702303443904575578202202857136.html?mod=WSJ_hp_us_mostpop_read

Will not time reveal the lasting importance of friends and mutual respect? Be kind to those who think well of you and those you know and try to add positive elements to your world. Promote peace in your heart and sunshine in the minds of those around you by your own good works. Elevate the level of discussion by thinking less of the issues and more of how you can reduce the tension of stress that arises with honest disagreement. Relax by breathing more deeply and consciously.

What are spies really like?

We have seen the Russian spies caught in America become celebrities claiming to have been unsuccessful. We have read about how spies infiltrated schools and workplaces during the cold war. We have seen James Bond 007, Mission Impossible, Spooks and Alias on television. But, what are spies really like?

I suspect that they are too busy in operations to be that well informed, but heh everyone has a view!

http://online.wsj.com/article/SB10001424052702303362404575579800140735056.html?mod=djemITPE_h

Will not time reveal the lasting importance of friends and mutual respect? Be kind to those who think well of you and those you know and try to add positive elements to your world. Promote peace in your heart and sunshine in the minds of those around you by your own good works. Elevate the level of discussion by thinking less of the issues and more of how you can reduce the tension of stress that arises with honest disagreement. Relax by breathing more deeply and consciously.

Head's Artwork Draws the People to the National Art Gallery

What is it about this artists work that makes it so interesting?

http://www.guardian.co.uk/artanddesign/2010/oct/28/clive-head-national-gallery-exhibition?CMP=EMCGT_291010&#

Will ye no think kindly on those who would be your friends! May the sun shine with your thoughts, today, and happiness grow in your heart! May you allow yourself some peace of mind.