ALL BLOG POSTS
As year is coming to an end I am sure that a lot of you like myself are reflecting on life and the world you live in. Here is a bit of what I have been thinking about this year and about what I think will be my focus in my blogging in the coming year.
My recent post on the suggestion for a Basic Income Guarantee (BIG) made me think of an idea I have been toying with for some time on how to privatize natural resources. Specifically I came to think of a suggestion for privatization of the Venezuelan energy sector, which I made some time ago in connection with my post on "A modest proposal for post-Chavez monetary reform in Venezuela".
Imagine that US non-farm payrolls were growing by 400k/month (that is how strong the UK labour market is)
My Danske Bank colleague Anders Vestergård Fischer had a fun idea today - he wanted to "translate" the latest UK labour market numbers into something an US audience could understand.
It has been said that the recent decline in European inflation to a large extent is due to a positive supply shock. This is to some extent correct and it is something I have acknowledged on a number of occassions. However, the main deflationary problem comes from the demand side of the European economy and the fact that monetary policy remains extremely tight in the euro zone is the main cause of the deflationary pressures in the European economy. A simple (but incomplete) way to strip out supply side effects from the price level is to look at the GDP deflator. This is what I here have done for Greece. This is the horror graph of the day - it is the level of the Greek GDP deflator relative to the pre-crisis trend (2000-7).
Nobel laureate Christopher Pissarides earlier this week gave a lecture at the London School of Economics on the theme "Is Europe Working?". It is an extremely interesting lecture. I disagree with a lot of what professor Pissarides is saying. He focuses far too much on fiscal policy issues and far too little on monetary policy. But it is in general a very enlightened lecture and he raises a number of extremely important questions about the future of the euro zone.
This is from Reuters:
Before you start reading this post note that I am not an equity market analyst and this is not investment advice. Rather it is an attempt to discuss the impact of monetary easing on the US stock market and to what extent the Fed's actions have created a stock market bubble.
Recently, the data for the UK economy has been very strong, and it is very clear that the UK economy is in recovery. So what is the reason? Well, you guessed it - monetary policy.
When I first read Milton Friedman's Free to Choose when I was in my teens two things particularly impressed me. First of course Friedman's monetarist ideas and second his strategies for moving from a Welfare State to a classical liberal society.