10 Nov 2016

An Example of the Tolerance of the Left

Politics 64 Comments

This is really amazing. One tweet is from election night, and the next tweet is two days later–it’s literally the 4th tweet after the first one I show.

and then

Similarly, there are plenty of black people on Twitter saying (literally), “Die white people, die!” and then also saying, “Even if you don’t bear personal ill-will to us, you have to realize that voting for Trump makes us feel persecuted.”

Just wait till the economy crashes. This is going to be ugly.

09 Nov 2016

Potpourri

All Posts, Potpourri, Shameless Self-Promotion 20 Comments

==> My reflections on Trump’s victory.

==> David R. Henderson and David Friedman discuss semi-private military defense in Estonia.

==> Mark Skousen sends me this analysis of the government’s Gross Output (GO) figures, which Skousen argues measure the “Hayekian triangle.” (In contrast, GDP effectively only measures the final stage, consumption, if we are in a stationary economy.)

==> You guys know I am your humble servant, but BOOM check out my analysis of the housing sector from back in June 2008. (That’s 3 months before Lehman, for those keeping score.) I had forgotten I wrote that, but someone asked me for my publications on the topic. I thank the market-savvy von Pepe; I think I surely must have consulted with him before writing that article.

==> David R. Henderson (in the comments of another post) passed along David Bernstein’s excellent refutation of the claim that Trump’s final ad was anti-Semitic. A good excerpt:

First, and in contrast to almost every article I’ve read about the ad, suggesting that Jews were somehow featured, the Jews in the ad only appear for a total of about four seconds in a two-minute ad. Second, only Yellen and Soros are identified by name. I doubt 1 in 20 voters even knows who Yellen is, much less her ethnic background. Moreover, neither has a recognizably Jewish name — if you were going for the anti-Semitic vote, why not use Clinton supporters far more well-known and identifiably Jewish, such as Steven Spielberg, Joe Lieberman, or even Sarah Silverman? I didn’t know Yellen is Jewish. Third, Lloyd Blankfein is pictured, but not identified by name. How many voters would recognize Blankfein? I didn’t. And how many of those know he’s Jewish? Again, I didn’t.

One Facebook friend suggested that the ad wasn’t meant to appeal to the run-of-the-mill anti-Semite who doesn’t know Yellen from a hole in the head, but to the hardcore white-supremacist types who keep track of important Jews and would even recognize Blankfein. But why waste your campaign’s money with appeals to a group that likely numbers in the tens of thousands when there are literally millions of undecided voters still at large?

09 Nov 2016

Gun Stocks and the Efficient Market Hypothesis

Economics 18 Comments

Does it make sense that gun stocks soared when Obama won, and tanked when Trump won?

The layperson intuition is obviously, “People rush to buy guns when they think a ban is imminent, and so the higher sales are good for Smith & Wesson stocks.”

However, does that make sense? Shouldn’t today’s stock prices reflect the long run?

(For example, nobody would expect coal stocks to rise after an Obama victory, even though there might be a small effect of people buying electricity ahead of new EPA rules and a consequent price hike in energy.)

One way to make sense of this outcome is that even over the long term, people are going to buy more total guns if they think the federal government is going to try to ban them. In other words, the prospect of an Obama ban didn’t merely “pull sales forward,” but it created sales that otherwise would never have existed.

Is this the only plausible mechanism? Because in general, it seems weird that investors might secretly hope for the government to outlaw their product. We didn’t see this in the tobacco industry, right? If not, why the difference? (I am not merely asking rhetorically; I can think of some relevant differences, which might be driving the results. But I open the floor to discussion.)

09 Nov 2016

Is It Smart to Vote Immorally?

Politics, Shameless Self-Promotion 9 Comments

I say no.

Some of you were expecting me to gloat, weren’t you? Well I’m not going to. (I was somewhat snarky on Twitter, but only because of people who were so confident beforehand.) Indeed, for those of you horrified by President-Elect Trump, I can say that I was telling people not to vote for him (or anybody) before the election.

All joking aside, here are some remarks that you’ve never heard me give before.

08 Nov 2016

Even Economists Should Check Out My GDP Article

Economics 25 Comments

I realized my last excerpt might not have alerted professional economists to the fact that I have some novel (I think?) points on GDP accounting in my latest EconLib piece. Some excerpts:

[S]uppose that one method of producing 1,000 cars draws down on the fixed stock of iron ore located in a country’s mines, while another method relies on only renewable resources. Again, standard GDP calculations would score the two methods as equivalent, ignoring the “deductions” from the wealth of the country in the form of mineral resources.

and

Our discussion of the bread industry revolved around intermediate versus final purchases. If a baker spends $120 buying flour that is used up during the year, then that expenditure does not count in GDP. On the other hand, if the baker spends $10,000 buying a brand new oven, then that is classified as a final good and does contribute $10,000 to that year’s GDP.

However, this distinction is somewhat arbitrary. Suppose that, instead, we calculated GDP over the entire lifespan of a new oven rather than over one year. In that case, the $10,000 spent on the oven in the beginning of the period would be economically equivalent to the $120 spent on the flour; all of these resources would be “used up” in the production of final loaves of bread for consumers. Therefore, the GDP calculation is sensitive to the time period chosen, even though this shouldn’t be relevant to economic well-being.

Also, I clarify why Mark Skousen (among others–including Rothbard in Man, Economy, and State) doesn’t appreciate the emphasis on consumption that the U.S. GDP figures give. My clarification:

To reiterate our earlier discussion, the conventional GDP approach doesn’t include these expenditures by the businesses at each stage in the bread industry because they represent spending on intermediategoods, not final goods. There is a reason for this decision: we want to avoid double counting, so, for example, we don’t want to count the $120 spent by the baker on flour if we’re already counting the $200 spent by consumers on the final loaves of bread. However, the danger here is that the GDP concept gives an exaggerated importance of consumer spending in the overall economy. In particular, even though the $120 spent by the baker on flour doesn’t add anything to the GDP calculation, it is certainlyeconomically critical. If all of the bakers suddenly decided to refrain from reinvesting their revenues in buying more flour, then the output of bread would pretty quickly come to a screeching halt. No matter how much money the final consumers were willing to offer the grocery store owner, she couldn’t sell them any bread if the bakers had previously stopped the gross reinvestment of their proceeds.

07 Nov 2016

Murphy Twin Spin

Economics, Shameless Self-Promotion 6 Comments

==> The latest episode of Contra Krugman has Tom and me discussing the FBI. (We are experts.) But for real, some good stuff on affirmative action.

==> My new EconLib is up, on problems with GDP accounting. An excerpt:

People often use the GDP formula to erroneously derive conclusions about economic causation. For example, in the wake of the financial crisis of 2008, some proponents of “stimulus” spending argued that a boost in government spending on infrastructure would obviously raise GDP because the textbooks tell us that GDP = C + I + G + (X-M). If the government increases G, according to this argument, GDP obviously must increase, as an increase on the right-hand side of the equation “had to” be balanced by a comparable increase on the left-hand side.

However, the textbook formula does not mean that (say) a $100 billion increase in G must go along with a $100 billion increase in GDP. For all we know, a $100 billion increase in G might cause a $40 billion drop in private consumption (C) and a $60 billion drop in private investment (I). In this case, GDP would remain unaffected, and the private sector would shrink to perfectly offset the growth in government. The textbook GDP formula is consistent with both outcomes, so the accounting tautology, by itself, tells us nothing about the impact of an increase in government expenditures on the economy.

07 Nov 2016

Trump’s Final Appeal to the Voters

Politics 33 Comments

This is a really good ad. I think this is what he had to work with, and he swung for the fences. I think future politics classes will look at this ad the same way they will study, say, the Goldwater campaign.

The only other commentary I will make is to note the points in the video where Trump identifies enemies, in order to get people to vote for him. I will identify people according to their official demographics, for a purpose that will be clear at the bottom.

0:05 Hillary Clinton (white Christian woman)
0:21 George Soros (Jewish man)
0:22 Janet Yellen (Jewish woman)
0:24 A whole group [20+ people] of financial ministers and central bankers, with all kinds of colors, men and women.
0:33 Obama walking with Prime Minister Abe (I think?) (black Christian man, Japanese man)
0:36 Bill Clinton (white Christian man)
0:44 Hillary Clinton shaking hands with Tony Blair (I think?) (white Christian woman, white Christian man)
0:48 Bill and Hillary Clinton representing “the political establishment” (white Christian man and woman)
0:59 – 1:04 More coverage of “global power structure” with 10+ foreign elites, both sexes and many colors
1:14 Lloyd Blankfein walking to podium at Clinton Global Initiative (Jewish man)
1:15 – 2:00 Video doesn’t show any more enemies, but instead shows the average Americans who will save the day.

So, naturally, in light of the above list, it makes sense that Paul Krugman tweets:

Not to be outdone, Scott Sumner wrote:

PPPPS: Trump finishes his campaign as classy as he staged it, with an alt-right ad targeting three people in an international conspiracy of financial-types, who all “just happen” to be Jewish:

Minnesota Sen. Al Franken on Sunday called a new advertisement for Donald Trump’s campaign “something of a German shepherd whistle” designed to appeal to his supporters in the so-called alt-right.

The TV spot warns of the influence of “those who control the levers of power in Washington” and “global special interests,” and it raised eyebrows among observers who said it contains anti-Semitic overtones. As CNN’s Jake Tapper noted to Franken on Sunday morning on “State of the Union,” commentators have pointed out that it targets three public figures who are Jewish — billionaire George Soros, Federal Reserve Chair Janet Yellen and Goldman Sachs CEO Lloyd Blankfein.

Maybe St. Bernard whistle would be more accurate. Or Great Dane. Or whistle best heard by people with tinfoil hat receptors.

Krugman and Sumner are getting sloppy. Trump’s ad also targeted a black guy and a white (Christian) woman. So the ad is racist and sexist, too.

Last thing: For those trying to understand how in the world DONALD TRUMP got so many people on his bandwagon, Krugman and Sumner’s smug attitude is part of the reason. Believe it or not, there are a lot of non-racist people who are sick and tired of walking on eggshells. So yes, *actual* racists would like Trump more than Hillary too, but when you’re not allowed to criticize some of the most powerful financial people on Earth because they’re Jewish, well, don’t be surprised if people eventually flip out and support a “protest” candidate.

06 Nov 2016

Why You Can’t Really Keep Theological Views Confined to Sunday

Religious 28 Comments

Welp, in case you haven’t heard, one of the recent items to emerge from the rounds of WikiLeaks dumps is the claim that Hillary Clinton’s campaign people may be involved in Satanic rituals, such as “spirit cooking” and more sinister things involving children.

In the interest of objectivity, I’ll let a completely skeptical New York Mag writer explain the allegations, as he tries to contain his guffawing. This way you know I’m not leading the witness.

So the reaction to this particular subset of the WikiLeaks dumps doesn’t come down to “Hillary vs. Trump.” Rather, it’s closer to a division between “believer vs. agnostic.” Specifically, I have seen plenty of libertarians on social media–who can’t stand Hillary Clinton–nonetheless roll their eyes at the people claiming this is evidence of monstrosities within the Clinton circles.

Yet I think the problem here is that if you don’t actually believe the devil exists, then it’s going to be hard for you to get worked up about people doing really creepy, occultish things. After all, by stipulation (in your worldview), that’s the end of it. There is no more significance to some weird ritual, than the physical actions of the people involved.

On the other hand, if you think that there is a devil, and that there really are people who have sold their souls to achieve earthly power, then it very much might concern you to know that Clinton’s campaign chief was cordially invited to a “Spirit Cooking” dinner with this lady:

P.S. I will correct this if someone points me to a definitive refutation, but my understanding is that that gloppy red stuff is actual blood.