Japan Learns to Live with Deflation (If Only Analysts Could Figure Out How)
In Japan, wages are lower, but so are prices for goods and services, even food. Japan’s companies are devising ways to profit from deflation, says Bloomberg writer Aki Ito in Japan Learns to Live with Deflation. Ben Bernanke has been lecturing on deflation’s perils since he joined the Federal Reserve in 2002 and has often [...]
Read MoreLooks Like Lowering the Value of the Dollar Does Reduce the Trade Deficit With China
The NYT reports on how rising prices and wages in China are dampening demand for its exports. The article presents rising prices in China as an alternative mechanism to a revaluation of the yuan (devaluation of the dollar) for reducing the U.S. trade deficit with China. While the assessment in the article is largely anecdotal, [...]
Read MoreHello Ben Bernanke, Meet "Stephanie"
Here is an email from “Stephanie”. She heard me talk about the economy on Coast-to-Coast AM radio with George Noory. Stephanie writes …. Hello Mish, I don’t know if you give advice, but I heard you on Coast-To-Coast and you seem to know what you are talking about. I am 65 years old, get $938 [...]
Read MoreElBaradei Unifies Opposition, Criticizes Obama; Business Grinds to a Halt; Ports Shut Down, Food Prices Soar; Shortages of Food, Water, Fuel
Business in Egypt has ground to a halt. Food and consumer goods stack up in ports. Gas stations have not had deliveries for days and supplies dwindle. Simple economic theory suggests prices will soar and they have. After an initial lukewarm reception when he first returned to Egypt, Nobel laureate and opposition leader Mohamed ElBaradei [...]
Read MoreMath and Economics Are Hard!
That is pretty much what former Obama adviser Steven Rattner had to say in the Washington Post today. In his piece, Rattner told President Obama: “don’t blame the talented economists who were advising you …. Creating jobs is a slow and frustrating process in the wake of a tough recession.” Calling the president’s economic advisers [...]
Read MoreParty Time in Davos
Egypt is flying apart, China and India are both overheating, and there has been no financial reform that will accomplish anything; nonetheless, it’s party time in Davos. One analyst with not enough clearance to party had a different message, so did Bloomberg columnist Simon Johnson. Otherwise it was party on dudes. Please consider Lonely Analyst [...]
Read MoreYahoo Displays Numeracy Deficit in Social Security Coverage
A headline of a Yahoo article told readers that: “Social Security posting $600B deficit over 10 years.” Actually, the Social Security program is projected to run a surplus in every year of the next decade, adding more than $1.3 trillion to its trust fund, as people with access to the Social Security Trustees Report know. [...]
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