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Why Do We Want Low Oil But High Stock Prices?
The short answer is that (usually) oil is quickly consumed while corporate stocks are pure assets. When the price of oil drops, it allows people to consume more oil and get more benefits from it–they can drive more, produce more oil-based products, etc. In contrast, if the price of Fannie Mae drops 10%, nobody says, […]
Read moreNobel Laureates Endorse Marxism
My title is a bit of an exaggeration. (Isn’t it?) Monday’s WSJ has an article, “Nobel Laureates Say Globalization’s Winners Should Aid Poor” (sub req’d). The more I read of this article, the more grateful I became that I was never awarded the (pseudo-)Nobel Prize in economics. The entire premise of the article is that […]
Read moreI Have a T-Bone to Pick…
Over at Crash Landing (the “2nd best blog in the world,” according to one noted economist) I criticized the Pickens Plan for its awful economic analysis. (Note that I am heeding the conservationists’ pleas and have thus recycled my incredibly cheesy post title.) Pickens says: As imports grow and world prices rise, the amount of […]
Read moreA Classical Mechanics Question to Break Up the Monotony
A quick puzzle before plunging back into the dreary financial news… So I’m sitting in the left turn lane, the first car in line waiting on the turn signal. A school bus is turning left, coming from my right; i.e. it is making its turn in front of me. At first the driver is cutting […]
Read moreAnonymous Surveys Worse than Free Advice
“The U.S. economy may have avoided a recession but will grow below trend for some time as firms face higher prices for a range of goods that will cut into profits, according to a panel of economists surveyed,” we learn in a CNBC article this morning. As Nassim Taleb demonstrates in his book The Black […]
Read morePlug for Schiff’s Book Crash Proof
As part of my atonement for mocking Schiff back in early 2007, I always plug his book whenever appropriate. I don’t recommend it as a place to learn international trade theory, but if you accept his conclusions about the direction of the dollar and US assets in general, then you should read his recommendations for […]
Read moreSchiff versus the Establishment
Peter Schiff is a very interesting guy. He has been basically spot-on for the last few years with his warnings about the US economy. Are you surprised to learn that many big gun finance gurus mocked him along the way? Below are three good examples: (1) Schiff versus Arthur Laffer (8/28/06) (2) Schiff versus Steve […]
Read moreIs the Fed Inflating or Deflating?
At first you would think this should be an easy question for economists to answer–much like asking a doctor, “Is the patient’s fever getting worse?” However, there is actually healthy disagreement on the point even within the narrow group of very-free-market economists. Hard money guys like Peter Schiff have been warning that the US dollar […]
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