Crying over spilt milk or why higher interest rates are hard
Should you invest in a business? If interest rates are zero, the answer is probably yes. When money in a savings account or a bond earns nothing, any reasonable business promising a non-zero returns starts to look good. If it sells electric cars and promises a 10x payday in a decade, all the better. Sure,…
Nuclear submarine roundup
Australia will host, buy, then build nuclear submarines as part of the AUKUS alliance with the United States and United Kingdom. The deal is complex: three-parts over four-decades and a 12-digit price tag (~368 billion). The biggest defence project in Australian history, it’s also a significant commitment from the US and UK towards containing China.…
Thoughtful exchange on China – US
The conversation about China and the US is as polarised as the conversation between China and the US. Which is a pity, because it is the international relations problem of our time and it deserve a corresponding amount of thought and care. Both were on display in a recent episode of The Economist’s Drum Tower…
Do nudges wear off or why Robert Moses’ beaches may be dirtier today
Once on a university tour in Berlin, I slipped off to the bathroom. Washing my hands, I looked about for paper towels to dry them. Pasted over the dispenser was a glossy sign that read: “Most people take two towels.” I yanked out eight. The sign was “nudge theory” 101. Popularised by books like Nudge,…
Silicon Valley Bank or why bank regulators should ban WhatsApp
Apologies about the delay. We’re back Silicon Valley Bank collapsed last week. The bank lost money on a bunch of investments that looked safe (they always do) but turned out to be very risky. When it announced the loss, some of the people who had money with the bank got worried. What if the bank…
Inflation (re)targeting
Central banks by and large try to pin inflation to 2%. When prices rise above that, central banks lift rates, people lose jobs, the economy slows and prices slink back down. The higher inflation, the harder it is to muscle back down. Going from 8% to 4% will be tough and take time. Going from…
US and Europe fight for electric vehicles
Europe and the United States want more of the electric vehicle supply chain at home. Car factories, battery plans and refineries create jobs and useful know-how that countries want for themselves. Factories at home are also less likely to get caught up in trade wars. But there’s a finite number of car factories, battery plants…
Saudade
Former imperial powers can struggle to let go. The Portuguese, some five hundred years past their peak, even have a word for it. From The Rest is History’s four-episode romp through Portuguese history (start at the beginning): The famous Saudade of the Portuguese is a vague and constant desire for something that does not and…
Companies Are Leaving China, It Doesn’t Mean What You Think
Here’s a popular story: After decades of outsourcing to China, many companies are having second thoughts. Trade wars with the United States, political interference from the Communist Party and the threat of war over Taiwan are making China a riskier place to do business, and companies are looking abroad. AirPods maker Goertek is expanding its…
Made In ?
Companies are considering moving out of China because of tougher politics and higher wages. The Economist looks at an alternative: The question for Dell, Samsung, Sony and their peers is: where to make stuff instead? No single country offers China’s vast manufacturing base. Yet taken together, a patchwork of economies across Asia presents a formidable…
Pizzapreneur Falls On Hard Times
Don Meji is a pizzapreneur. Head of Dominos Pizza Enterprises, he oversees an empire of 3,700 slightly-cramped, brightly lit stores from Australia to Germany. Don Meji is also a little hard up. Who isn’t? Interest rates are rising and banks are sending polite letters to people who owe them money, asking them to pay a…
5 Climate Charts
Stumbled across a fantastic climate presentation from Nathan Bullard, who writes a widely read decarbonization column for Bloomberg. There are some snapshots in a Twitter post, but I recommend taking 20 minutes to flip through the full presentation. Some of my favourites: Will extractive industries shrink? The biggest miners and oil and gas companies are…
Government Reports Can Be Fun Too
Working my way through Robert Caro’s “The Power Broker: Robert Moses and the Fall of New York”. Highly recommended and I’ll be sharing a few excerpts as I wade through the tome. Sometime in the 1920, Moses was commissioned to write a report on civil service reform in New York state. The executive (the Governor)…
I’m Back – Also, Gooseberries
After 716 days, the blog is back. I’m settled into life as a journalist but missed this blog as a space for all the miscellanea that don’t fit neatly into daily news. Same drill as before, only I won’t be posting on weekends. Day of rest and all that. I finished “A Swim in a…
Blog update
Today will be the last daily post for a little while. I will still continue to post, but irregularly from now on. It’s certainly not for lack of interest. I come to my computer each morning excited, and I hope this blog is as pleasurable to read as it is to write. I never expected…
If there was ever cause for a wealth tax…
Beeple, who you may remember from my earlier post, has just sold an artwork for $69.3 million dollars at auction. He is now one of the three most valuable living artists. A massive congratulations to him. 5000+ days of work and dedication to his art has paid off in the best possible way. Since the…
The General Theory of Employment, Interest, and Money
Indeed it [the economy] seems capable of remaining in a chronic condition of sub-normal activity for a considerable period without any marked tendency either towards recovery or towards complete collapse I suspect John Maynard Keynes’ “General Theory” was to the 1930s what Thomas Piketty’s “Capital in the Twenty-First Century” was to the 2010s – much…
the midnight is passing, and joy cometh with the dawn
I mentioned Eugene Debs briefly the other day. Upon reading it, a friend sent me an excerpt from a speech of Debs’. Debs gave the speech upon being convicted, under the Sedition Act, of campaigning against the draft, and US entry into World War 1. I wanted to share it with you all now: Your…
Blockchain and crypto currency reading list
I’ve decided it’s time to get more familiar with all things blockchain, in particular cryptocurrency, central bank digital currencies, and NFTs. Do any of you have suggestions for good reading material? If so, please get in touch via the comments. If any of you are also interested, this is some of the material I’ve found…
Do royal scandals help the republican movement?
The sun sets in Montreal at 6pm, at which point it is already noon the next day in Auckland. When it falls below the horizon in Auckland, it has already been shining for 30 minutes in London. What unites New Zealand, Canada, the UK, and twelve other countries including Jamaica and Australia? Their shared head…
Recent additions to the bookshelf
New additions to the bookshelf you might like. The piles of unread books are growing faster than I can finish them, but I feel as if I’m surrounded by new and interesting friends. A Confederacy of Dunces – John Kennedy TooleMe Talk Pretty One Day – David SedarisThe Essential Kafka – Franz KafkaOn Writing Well…
On the Genealogy of Morality
I just finished Nietzsche’s On the Genealogy of Morality. While I digest the book for a longer write-up, here are some passages I found thought provoking: We modern men are heirs to the ancient practice of vivisecting our consciences, and inflicting curelty upon our animal selves. This we have practices for the longest time, and…
Dante missed a circle of hell
A small – no less frustrating for it – part of my week is spent unsubscribing from email lists. There’s my university alumni association, the Dutch immigration authority (don’t ask), a salsa school in Barcelona, Sony???, a bank I used once on holiday in 2013; an Israeli tour company; the concert venue where I saw…
One step closer to green monetary policy
In a world first, the Bank of England’s (BoE) mandate has been updated to include action on climate change. The Chancellor of the Exchequer made the announcement during yesterday’s budget speech (35.24): An updated monetary policy remit for the Bank of England. It reaffirms their 2% target but now it will also reflect the importance…
Bond market vigilantes
Government bond holders were the playground bullies of the 80s and 90s. They would threaten governments and central banks with bond sales to get what they wanted – usually fiscal discipline and lower inflation. Bond vigilantes – a self-appointed nickname – was presumably a way to sound more like Batman and less like thugs. Like…
Structural violence is a bad reason to limit speech
It is fashionable to be “nuanced” when talking about freedom of speech. I often read that speech should be restricted when it is harmful, hateful, and violent. The claim looks innocuous, it even bears passing resemblance to that old liberal formula “do and say what you want as long as you don’t hurt others;” a…
Trump, a third-party, and a golden calf
I’ve frequently discussed the possibility that Trump could run as a third-party candidate. I was wrong. At the Conservative Political Action Conference (CPAC) on the weekend, Donald Trump gave one of his first public addresses since leaving the White House. In addition to the usual ravings about electoral fraud, he also called rumors he would…
Things to not waste time on
We drown in content. Authors, thinkers, and officials are available on podcasts or YouTube commenting on almost any issue. Some of these conversations are interesting, many are not. Powerful people with reputations at stake, both theirs and their organization’s, are incentivized to be guarded. This is sensible policy when off-the-cuff comments can move markets, but…
A European Union (of sorts)
From Perry Anderson’s third and final essay on Europe for the LRB: Those from the EU actually living and working outside their country of birth in the Union form a number smaller still, less than 4% of its total population in 2015, of whom the large majority were manual labourers of one kind or another.…
Stoicism and self-help
I was at Kinokuniya on the weekend with a group of friends who were all looking for the same book. On the third floor of a mall in the city, Kinokuniya basically occupies the entire level, wrapping around the escalators from which you enter. Most bookstores have a history section, Kinokuniya has a Latin American…
Beeple
Hardly a day goes by without the catalogue of social media’s harms expanding. Our smartphones are bridgeheads from which apps like Instagram undermine our self-esteem, attention span, sleep, mental health, and relationships. One relationship social media has improved for me, is my relationship with art. Instagram has made it incredibly easy to discover art. Some…
Selected quotations
I have been re-reading Christopher Hitchens’ Letters to a Young Contrarian and wanted to share a few passages which stayed with me On racism It especially annoys me when racists are accused of ‘discrmination.’ The ability to discriminate is a precious faculty; by judging all members of one ‘race’ to be the same, the racist…
On finding science in the most unusual places
There was an Anti-Vax march in Sydney over the weekend. A family friend on Facebook spoke at the rally and shared the video in a post: Notice what he emphasizes: experimental vaccines, a rushed regulatory process. Then, from a recording of his speech: “I challenge Prime Minister Scott Morrison to prove to the world that…
No end in sight for the debate over inflation
The debate over the Biden’s administrations proposed stimulus I discussed a few weeks ago is still going. If you wanted to keep up to date, here are some useful links: Paul Krugman has weighed in againLarry Summers has responded to critics in another op-edOlivier Blanchard has presented his concerns in a more formal wayChris Giles…
What do jobless men do all day?
From a new study in the AEI by Nicholas Eberstadt and Evan Abramsky: “What do prime-age ‘NILF’ men do all day?” (thanks to Marginal Revolution) Some excerpts: And And And And A few quick thoughts: We don’t know why these men are not in the labour force. Does an absence of paid work/income support cause…
A budget for giving
At lunch with a friend yesterday, they mentioned how they set aside a portion of money each week to spend on other people. It’s part of their standard budget, just another category alongside rent, groceries, or entertainment. What does he spend it on? Anything from buying a coffee for someone at work, to treating friends…
The media standoff in Australia
Facebook shut off news access for Australian users on Wednesday. It’s part of an ongoing brawl over proposed legislation that would create a statutory code for bargaining between news organisations and large technology platforms like Facebook or Google. You can read more about it here or here. Some initial thoughts: This seems like an misstep…
How important is it to be original?
Have you ever written, spoken, drawn, molded, shaped, sewed, welded, or taught something, only to discover you were not the first? That your creation was derivative? Maybe deeply so? It is a painful experience, especially when the work of the lone inventor, the creative genius, seems so vital. Across the crucibles of human progress, Mars,…
Central banks, climate change, and firing an AK-47 underwater (wonkish)
Barry Eichengreen has written a piece for Project Syndicate on how central banks can help tackle climate change and inequality. The standard argument is that central banks do not possess the tools to combat these issues, and even if they did, doing so would call their independence into question, undermining their ability to fight inflation.…
They come from the land of the ice and snow
Got the first view from Antarctica today. I hope not the last. Would whoever this is mind getting in touch via the comments or email? I’d love to hear about what you are doing there… A quick Google search suggests Antarctica is inhabited entirely by Penguins, murderers (and their victims?), or monsters. Be safe.
Trump is performing better than the headlines suggest
Trump has now been acquitted in his second impeachment trial, notching up yet another “first.” Had you scanned the headlines of the New York Times or the Financial Times, you could be forgiven for feeling a modicum of satisfaction amidst the disappointment; Trump got off, but the Republican Party is breaking with him; Trump got…
China’s growing cultural muscle
I tend to discuss China’s growing assertiveness with reference its economy or foreign policy. It’s a pity, because China’s increasingly muscular cultural scene is illuminating. If you want to understand the trajectory of China over the next few decades, it’s vital to observe the stories China tells about itself. Check out this trailer for the…
Recent additions to the library
New additions to the bookcase that may be of interest to you: White Noise – Don DeLilloSelected Short Stories – BalzacRosencrantz and Guildenstern Are Dead – Tom StoppardStarship Troopers – Robert A. Heinlein (far more thought provoking than the film)Catch 22 – Joseph HellerOrientalism – Edward SaidReflections on the Revolution in France – Edmund BurkeThe…
Is Green Quantitative Easing on the horizon?
Many forces are pushing central banks to change how they operate: low inflation; hesitant fiscal policy; climate change; anemic growth; financial instability. Low inflation claimed the first scalp, when it led the Federal Reserve to switch to an average inflation targeting regime. Climate change may be the next. The FT reports that: This is a…
On learning which of Merriam-Webster’s 63 definitions of work suited me
I was taught very little about how to work at school or university, which is odd when I think about it. My youth was spent being (asked) ordered to do things – write essays, mow lawns, be nice, wash dishes, give presentations – but rarely being told how. I suspect the adults did not know…
Does carbon pricing work in practice?
Not according to a new meta-analysis out from Jessica Green in Environmental Research: Carbon pricing has been hailed as an essential component of any sensible climate policy. Internalize the externalities, the logic goes, and polluters will change their behavior. The theory is elegant, but has carbon pricing worked in practice? Despite a voluminous literature on…
Geopolitics and the energy transition
From today’s big read in the FT: But is the geopolitics of energy really about energy? To link geopolitics and conflict to a particular material thing is to miss the point a little. There is not a fixed set of objects we fight over, such that the sudden super-abundance of one reduces conflict as a…
He pulled his coat over his head, and lay still
I’ve read many accounts of war over the years: campaign map style histories where individuals hardly feature; swashbuckling adventures ala Sharpe; Antony Beevor’s awestruck reconstruction of the Battle of Stalingrad; the intimate realism of Svetlana Alexievitch. Never have I seen death described as in this excerpt from Ernst Jünger’s Storm of Steel. Jünger served at…
Macro economists argue over higher inflation (again)
Prominent macro economists are divided over whether the Biden administration’s proposed $1.9 trillion stimulus bill is likely to stoke inflation and curb future investment. In a Washington Post op-ed on Friday, former United States Secretary of the Treasury, Larry Summers, argued that the $1.9 trillion stimulus bill risked overstimulating the economy and stoking inflation. Summers…
Expectations, evolution, and technology
I got the IPhone 4 in my first year of university; a novelty to top off a year of novelty. It didn’t flip or slide. There was no stylus or keypad. You could connect to the internet in seconds at a time when hand-held internet access was still something of a novelty. It was not…
Do economic sanctions work? And a poem by Bertolt Brecht.
A convoy of military trucks speeds past. Armed men are disgorged outside parliament. TVs play patriotic music. Facebook goes down. Men in uniform grace local street corners. People are arrested. The patriotic music is interrupted to announce that General so-and-so is dissolving parliament to protect the constitution/democracy/the people. Condemnation follows from the democratic world. There…
“One has to get rid of the bad taste of wanting to be in agreement with others”
My book club read Beyond Good and Evil last month, and I’ve been meaning to write it up for a while now. It is a complicated book, and contains passages that span the full spectrum from disgust to inspiration. That being said, I enjoyed it. His philosophy is deeply individualistic. This is borne of necessity,…
India, supply-side econ, and gender discrimination
Three interesting links (thanks to Marginal Revolution): Supply-side economics and progressives are rarely found together, which makes this short article on the topic all the more interesting. You might recall the piece I wrote about the ongoing land protests in India. This Q&A covers the politics and economics in great depth. Recommended for further reading.…
Inflation forecasts or irrational exuberance?
If your eyes glaze over at the mention of inflation, take a look at this and feel free to go: Forecasting inflation Forecasting is an unforgiving art. There are an infinite number of wrong answers, and one right one. The years since the GFC have been particularly unforgiving for central bank forecasts, and no forecast…
“Because there probably will never again be such people as we were then”
I just finished The Unwomanly Face of War, Svetlana Alexievitch’s oral history of Soviet women in World War Two. I could only read the book a little at a time; there was too much pain, too much blood, too much thoughtless heroism in the face of incomprehensible suffering. Reading it quickly would inure you to…
China’s Youth
The Economist has a new special report out on China’s youth. It is fully of anecdotes and analysis on: “the jiulinghou, or “post-90s”, a shorthand term for those born between 1990 and 1999. They number 188m—more than the combined populations of Australia, Britain and Germany.” The question lurking beneath the special report is why the…
Keynes on GameStop
I could not resist another Keynes quote in light of recent events The social object of skilled investment should be to defeat the dark forces of time and ignorance which envelop our future. The actual, private object of the most skilled investment today is ‘to beat the gun’, as the Americans so well express it,…
The FOMC meets and, among other things, we discover Jerome Powell has been vaccinated
The FOMC met for the first time in 2021 yesterday. The committee has maintained its accommodating policy stance as the economic recovery slows in the US. As at the last meeting, the Fed expects to keep this in place for some time: With regard to interest rates, we continue to expect it will be appropriate…
GameStop, Can’t stop, Won’t stop
There are a few GameStop stories: a story about hedge funds fleeing before a subreddit on a warpath; a story about how commission-free trading on apps like Robinhood is transforming retail investing; a story about a guy who turned $50,000 into $13.9 million (and counting) and then dunked a chicken tender in champagne. If you’ve…
“The very idea of assumed equilibrium bothered me”
One of the most frustrating parts of reading is forgetting. I struggle to describe a book in any meaningful detail even a month after finishing it, which somewhat undermines the learning experience. Highlighting, note taking, and folding pages all help stem the memory loss, but there are limits to what can be achieved without creating…
Porque no los dos? Dual interest rates and monetary policy
When we talk about monetary policy, we tend to think of the interest rate, singular and all-powerful. I used to imagine a giant lever in the basement of the Reserve Bank of Australia that the Governor would adjust while the rest of the Bank watched in silence. Like many things we tend to think, this…
Graph for the day
From the Fed’s June 2020 monetary policy report:
The Unwomanly Face of War
I am reading Nobel Prize Winner Svetlana Alexievich’s oral history of Soviet women in World War 2, The Unwomanly Face of War. Some passages that have stood out so far: On remembering I often see how they sit and listen to themselves. To the sound of their own soul. They check it against the words.…
Keynes on what makes ideas attractive
Keynes on why classical economics exerted the influence it did, from Chapter III of the General Theory: That it reached conclusions quite different from what the ordinary uninstructed person would expect, added, i suppose, to its intellectual prestige. That its teaching, translated into practice, was austere and often unpalatable, lent it virtue. That it was…
Big Meat in the FT
I was left confused by “Big Meat: facing up to the demands for sustainability.” Surely this is not the same FT which so relentlessly pursued Wirecard? The meat industry, as presented in the article, seems combative, not reflective. Cattle heiress Josie Angus tells us official sustainability reports are “apologies to ‘virtue signallers,’ before using climate…
It’s all about confidence baby
If anyone finds what is written here obscure or unintelligible, I do not think that the blame should lie upon me. The meaning should be clear enough to any reader who has first read my previous writings carefully, without sparing himself the effort needed to understand them, for that is not, indeed, a simple matter.…
Are we crying wolf over inflation?
The FT has just published an op-ed from one Professor Jeremy Siegel of Wharton. In it, he predicts that the US is going to experience “an extremely inflationary economy in 2021,” where “inflation will run well above the Fed’s 2 per cent target, and will do so for several years.” This is a contrarian position.…
A new consensus
Where was this published? A progressive think tank? Marxists.org? None other than the IMF!
Beware the fair-weather fiscal friend
As I’ve discussed before, a change is in the air for fiscal policy. The FT has done a mea culpa and said “the aim of balancing the budget can, at least temporarily, be dropped.” This is good news for those who have waged the long and lonely war against the fiscal hawks, but I want…
And in Europe…
Its been a big news week in Europe. The entire Dutch cabinet has resigned following a scandal where the tax authorities unfairly targeted minorities with demands to repay childcare benefits. This, in one of Europe’s biggest corporate tax havens. The government was already in caretaker mode thanks to elections in March, which Prime Minister Mark…
Another day, another fiscal policy framework
It’s an exciting time in fiscal policy. A new paper out features three unlikely bedfellows. Financiers cum public servants Peter Orszag and Robert Rubin, advocates of fiscal discipline and balanced budgets in the Clinton and Obama administrations, have published with Nobel Laureate Joseph Stiglitz, of “resigning from the World Bank in protest” fame. Their core…
On the value of suffering
We all suffer, but is it anything more than a sensation to be avoided or grudgingly endured? In different ways, both Nietzsche and Nassim Taleb have something useful to say. Nietzsche thought suffering was vital, so vital in fact, that he wished it on his friends (it is unclear how many he had). From Beyond…
Without a touch of masochism, the meaning of life is not complete
I hope you will forgive the double post, but I could not resist some excerpts from another of Joseph Brodsky’s wonderful essays in ‘On Grief and Reason.’ This one is titled ‘Speech at a stadium,’ and was delivered for a commencement speech at the University of Michigan in 1988: To covet what somebody else has…
Passion is the privilege of the insignificant
Boredom is endangered. Streams of dopamine have pushed it past Wi-Fi range. If, as Bertrand Russell suggested, we should all be more idle, we must learn to confront boredom head on. Thankfully, poet Joseph Brodsky’s essay “In Praise of Boredom” (this collection) dissects boredom in a moving reminder of its importance. Known under several aliases-anguish,…
What I’m reading
My post on what one should read was quite popular, so I thought I would share what I am reading right now, as an illustration of the principles in action. I usually try to pair an easier and harder read together. This once meant non-fiction during the day and fiction at night, but I increasingly…
The imitation game
T.S. Eliot, quoted in a piece on the history of literary imitation in the LRB. The article explores the tensions between the influence and imitation, between the modern longing for individuality, and the impossibility of truly breaking with our intellectual or literary precursors. Well worth reading.
Things are not what they seem
While we stew in our outrage and disbelief at the storming of the US Capitol… From the Economist From the New York Times Finally, after legislators were escorted back to the Capitol under armed guard, eight Republican senators and 138 representatives still voted to object to the electoral college votes being certified. The question is…
How should you pick what to read?
How should we pick what to read? If there are always more books than time, hard decisions must be made. I’ve been thinking about it over the last few weeks and want to share my conclusion. It probably only applies for reading where the goal is to learn new things, particularly about social dynamics. The…
The battle for the future of the Republican Party
That battle kicks off today. Trump has released a statement condemning the violence and promising an orderly transition, however he closed by saying “our incredible journey is only just beginning.” Are we watching the beginning of Trump 2024 or Trump the third-party candidate?
Anarchy in the USA
Time moves quickly in politics and yesterday’s abstract questions are being worked out far quicker than I thought possible. A few quick points: Looking past the unprecedented images, is this a demonstration that America’s democratic institutions were, when push came to shove, more resilient than some thought? That no matter how faint and far away,…
What would a Democrat victory in Georgia mean?
As of writing (1am Australia/9am Georgia), it looks as if Democrats are likely to win both run-off elections in Georgia, handing them control of 50 of the Senate’s 100 seats. With the Vice-President casting a vote during ties, Democrats would have defacto control of the chamber. The NYT has excellent rolling coverage. While winning control…
Montaigne for the new year
Some more food for thought for the new year, this time from Montaigne: To keep ourselves bound by the bonds of necessity to one single way of life is to be, but not to live. Souls are most beautiful when they show most variety and flexibility For more wisdom from Montaigne, see this earlier post
2020 in review
Today is the 141st post. It has been a demonstration of how quickly small habits add up. In the last four months of 2020 I wrote 45,022 words, with an average of 331 words per post. Had I written them all on the same subject, I would have the draft of a small novel. In…
Intel, chip manufacturing, and power
The FT reports that hedge fund investor Third Point wants Intel to divest its microchip manufacturing business. Today Intel both designs and manufactures chips, but is increasingly falling behind new chip manufacturers in Taiwan and Korea. Why should we care about arcane maneuvering in the chip industry? Two points to take note of: The design…
The first Keynesian?
It is the fate of famous thinkers to be reduced to caricature. Those outside the limelight at least keep their nuance. Since reading Zachary Carter’s biography of Keynes earlier this year, I’ve been exploring more of the great man’s nuance. ‘Keynesian’ is now synonymous with massive crisis spending programs, but this characterisation both fails to…
The stab-in-the-back myth and Trump
On January 6th, Congress will receive the Electoral College’s votes to certify. This normally symbolic step will now be debated and voted on, following Republican Senator Hawley’s decision to object to the results. The vote is almost certain to meet the same fate as all of Trump’s attempts to overturn the election – failure. However,…
Happy New Year
Remember to take chance by the forelock
Before there were helicopter parents
From an LRB essay on women in the Victorian economy: As always, worth checking out.
In praise of idleness
Over Christmas I re-read Bertrand Russell’s wonderful essay, In Praise of Idleness. Its message is still incisive and revolutionary, if in slightly different ways. In Russel’s day, elites jealously guarded leisure for themselves while proclaiming the dignity and virtue of work for others. Today, the leisure class has committed suicide, and both rich and poor…
Sustainable investing
Investments which take broader environmental or social goals into account are increasingly popular. Under the banner of ESG, finance is trying to offer socially conscious investors an ethical way to make money, and even create social change. Like all things, the devil is in the detail. From this piece on ESG investing in the FT:…
Fiscal policy – Christmas edition
My family knows me well
The role of government
From Keynes 1926 essay “The end of Laissez-Faire” We cannot therefore settle on abstract grounds, but must handle on its merits in detail what Burke termed ‘one of the finest problems in legislation, namely, to determine what the State ought to take upon itself to direct by the public wisdom, and what it ought to…
James Tobin on Business Cycles
In 1994 the Federal Reserve Bank of Boston hosted a conference on monetary policy. Today it is mostly remembered for Debelle and Fischer’s paper on goal vs. instrument independence, but it has proved full of gems. This was a time when the modern central bank was still emerging and so lacked today’s (somewhat diminished) aura…
China stories part 2
(Part 1) Today I want to discuss a podcast on the One Belt One Read initiative (1B1R). 1B1R is China’s signature international policy, made up of hundreds of billions in loans to mostly developing countries in Eurasia to build infrastructure and other projects (for a quick refresher, this piece in The Guardian). The discussion made…
China stories part 1
I’ve consumed a few thought provoking pieces on China in the last week I wanted to share. Today, this piece in Noema on China’s dual circulation strategy. Chinese policy is often expressed as idioms or special slogans.* “Dual circulation” is the latest phrase in use by China’s leadership to describe its developmental strategy: The article…
Africa and the future of geopolitics
We live in an age where geopolitics is again an everyday issue. Even in quiet Australia, we’re grappling with the consequences of great power politics thanks to our own trade war with China. While the main stars – China, the US, the EU – are familiar, the global cast is actually far larger. Adam Tooze’s…
Vanguard, iShares, and Passive Investing
In 1976, the management guru Peter Drucker published an article called Pension Fund Socialism. Today it has been mostly forgotten, but its a remarkable look at how pension funds – relatively new in his day – were reshaping finance and capitalism. Today we are confronting a new stage in the evolution of financial capitalism: index…
Fiscal policy – automatic stabilisers and government as the risk taker of last resort
In last week’s posts on fiscal policy (1, 2, and 3), I focused on discretionary policy. Today I want to talk about automatic stabilisers. Automatic stabilisers are fiscal policy on autopilot. Unlike one-off spending bills, automatic stabilisers work through changes in spending and taxation triggered by economic changes. In a recession, tax receipts with incomes,…
On transracial and transgender identity
It is common today to see membership to a particular social group determined by individual identification. The classic example is gender, which many hold to be determined by how one personally identifies, not biology or social class. Now, if claims to group identity are arbited by the individual’s lived experience then presumably similar categories like…
Out with the old, in with the new?
From a 1994 conference on monetary policy, this quote from the famous Paul Samuelson: I am reminded of a similar sentiment expressed by Nietzsche in Beyond Good and Evil: That which an age feels to be evil is usually an untimely after echo of that which was formerly felt to be good – the atavism…
Something Interesting. Most Days. 