==> S4L response to Piketty.
==> So the government has been caught repeatedly lying about the extent of its NSA activities. I’m shocked.
==> Krugman has already explained that people oppose ObamaCare because they hate poor people. In this post he clarifies: It’s specifically poor *black* people the critics want to get sick and die. Keep it Klassy Krugman.
==> Speaking of which, in two recent posts Krugman claims quite confidently that ACA enrollment is currently higher than the projections, but he offers no link. That makes me guess (not certain, just a guess) that it’s the other way around. Anybody have these numbers quickly at hand? Something like the CBO estimate made back in 2010 for right now, compared to reality?
==> Dan Sanchez was not happy about Tyler Cowen’s essay on the economic benefits of war.
==> I just want to point out that I scooped Alan Reynolds by a few days (at EconLib) on why his earlier work shows the problem with the Saez-Zucman wealth figures. The only person I’ve seen give even decent pushback on our brilliant points is Daniel Kuehn. I don’t expect any big guns to respond to me, but has Zaec or Zucman or Piketty answered Reynolds?
At FEE’s site, I make the case that permanent life insurance is a relatively tame option (as opposed to exotic things like Bitcoin) for seceding from the current system that has trapped so many middle-class Americans. An excerpt:
Although Mises refers matter-of-factly to life insurance as a savings vehicle, in the United States it was gradually displaced by mutual funds, which had become more accessible to the average household and looked very attractive by the late 1970s. The high interest rates and inflation of this era—the result of government manipulation in the financial markets—suddenly made conservative life insurance look boring and sluggish. Americans were steered by the “experts” into Wall Street, and federal tax laws—which levy large penalties on all assets except the ones exempted by the IRS—only reinforced the transformation of the conventional wisdom.
Yet even though we can understand the historical events that pushed Americans away from the use of life insurance as a savings vehicle, the pendulum is beginning to swing the other way. The downside of “tax-qualified” retirement plans is that their tantalizing breaks on tax treatment come with significant strings attached, such as stiff penalties for early withdrawal. Furthermore, the appeal of the stock market as a hedge against price inflation is greatly muted when it is subject to periodic crashes.
Naturally, if you want to learn more about this perspective, you should come to the Night of Clarity in downtown Nashville August 15-16! Details here.
I was reading an issue of The American Conservative that was complimentary at FreedomFest, and saw this passage from Ezekiel quoted in an ad in the beginning:
21 “But if a wicked man turns from all his sins which he has committed, keeps all My statutes, and does what is lawful and right, he shall surely live; he shall not die. 22 None of the transgressions which he has committed shall be remembered against him; because of the righteousness which he has done, he shall live. 23 Do I have any pleasure at all that the wicked should die?” says the Lord God, “and not that he should turn from his ways and live?
I thought it was important for some of you to see this.
Since I’ve been traveling so much, I’ve been remiss in keeping you up to speed with my machine-like output:
==> Tom Woods and I jerk-shame our libertarian peers.
==> Economic growth isn’t just about technology, it’s also about saving and investment.
The recently released Fed minutes contain the following information on their plans to fully complete the so-called taper:
[P]articipants generally agreed that if incoming information continued to support its expectation of improvement in labor market conditions and a return of inflation toward its longer-run objective, it would be appropriate to complete asset purchases with a $15 billion reduction in the pace of purchases in order to avoid having the small, remaining level of purchases receive undue focus among investors. If the economy progresses about as the Committee expects, warranting reductions in the pace of purchases at each upcoming meeting, this final reduction would occur following the October meeting.
Right now (July) the Fed is buying $35 billion of new bonds per month. (In other words, it is reinvesting the proceeds to maintain its holdings as existing Treasury and mortgage-backed securities mature, and then on top of that, the Fed is buying an additional $35 billion per month–$20 billion in Treasuries and $15 billion in MBS, or at least that was the official target; they bought $1 billion more in Treasuries last month and so are only buying $19 billion this month.) The current plan is that–so long as the economy doesn’t crash–the Fed will taper to $25 billion in August, then $15 billion in September, and then wipe out the remaining $15 billion in October. At that point, the current plan is that the Fed would hold pat, reinvesting the proceeds from maturing securities to maintain a fixed total of assets.
Just to remind everyone, here’s a chart showing the behavior of the S&P500 versus the monetary base (which has exploded since late 2008 because of the Fed’s policies):
As the chart shows, it used to be the case that the stock market bounced around with little relation to the Fed’s asset purchases. But since early 2009 and the introduction of “quantitative easing” programs, the stock market and the Fed’s bond buying have moved in virtual lockstep.
Let me ask you this: Do you think the S&P should be hitting all-time highs because of how great the underlying economic fundamentals have been the last few years?
Here’s the YouTube version of my recent interview with Tom:
Like what you hear here? Then come to Nashville on August 15 to hear more of Tom and me, plus David Stockman! (And others.) Details here.
In my latest EconLib article, I first walk through the basics of income and capital accounting. (Even if you think this is standard stuff, you might want to skim it because there are some subtleties.) Then I give three examples of how people often get mixed up about what the empirical evidence means. In particular, I offer a theory to explain why the new Saez-Zucman measure of wealth inequality departs so dramatically from what used to be the gold standard, the Kopczuk-Saez measure (based on estate tax returns).
I am working on a post that gets into the specifics, but my first reaction to Henry Paulson et al.’s recent evangelism on climate change policy. An excerpt:
In a sense, Henry Paulson actually is a great guy to be spearheading the movement to get the federal government heavily involved in the energy sector. He has a history of obfuscation and mafia tactics with which he showers his cronies with government-backed privileges.