FXstreet.com reports (htp: Alice) on significant increase in UK M4 money supply and lending (someone please help me with the distinction). Conclusion: inflation.
To put it in context, click here for BoE long run stats on M4.
Saturday, July 19, 2008
Friday, July 18, 2008
Comments, please
I had the last comment here come through tonight, but although it's long and features words in capital letters (usually a bad sign), I read it. Shame it's anonymous, and maybe it could do with editing, but aren't there elements in it with which you could agree? Is he (I assume he, for some reason) right about wealth distribution in the USA?
UPDATE
That rant has indeed been copied and pasted as the author suggests, with slight variations. I've done a little digging via Google (there's about 1,600 instances) and the earliest date-stamped version I can find so far is 26th February 2008 here, though quite likely there's earlier ones.
I don't know what he's got against Oprah.
The "1% own 50%" claim startled me - looks like England in the 19th century. Anybody able to confirm the inequality data? And will the sucking-up of wealth by the rich destroy the economy, as the ranter claims?
UPDATE
That rant has indeed been copied and pasted as the author suggests, with slight variations. I've done a little digging via Google (there's about 1,600 instances) and the earliest date-stamped version I can find so far is 26th February 2008 here, though quite likely there's earlier ones.
I don't know what he's got against Oprah.
The "1% own 50%" claim startled me - looks like England in the 19th century. Anybody able to confirm the inequality data? And will the sucking-up of wealth by the rich destroy the economy, as the ranter claims?
Should we let Africa starve?
Wofie's post on the futility of charity in Africa, a rider to Kevin Myers' article in the Irish Independent, gave me pause for thought. Are we wasting our money keeping poor children alive, so that they can grow up to be gangster-soldiers? If abortion is the answer to the criminal classes (not actually advocated as such by the authors of "Freakonomics"), is starvation the solution to civil war in Africa?
"Africa’s peoples are outstripping their resources, and causing catastrophic ecological degradation," says Myers. Perhaps, if they do things as they have done before. But on that basis, one would never have predicted the growth of Europe's population to its current size.
One of my relations by marriage went to Kenya to try his fortune some years ago, and having married a local girl from the Kikuyu tribe, bought a farm. His new wife is clever and sent off for pamphlets on farming, from which she learned that you can multiply the productivity of your land by companion-planting several crops. I wonder how much more food Africa could produce if agricultural skills there were better developed and disseminated.
Even in Europe, there are disparities in efficiency. Up to the end of World War 2, my grandfather had a farm in East Prussia. His 600 acres produced at least as much as the 2,000-acre farms of his neighbours. He compounded this advantage by diddling the taxman, telling the latter that as a simple farmer, he didn't understand finance and would the taxman please assess him on what his land could be judged to yield. You may be sure that he paid his tax bill without argument.
And what about modernising energy supplies, too? As a child, I saw a map of the Congo Basin and fantasised about damming the encircling ring of mountain ranges to make the world's greatest hydro-electric project, supplying the electricity needs for the whole of Africa. Of course, I hadn't considered ecological consequences; but in the Sixties, all I ever (over)heard of "ecology" was an brief, excited discussion between two of my teachers. This doesn't vitiate the argument for looking for efficient energy production that doesn't require chopping down all the forests to cook on wood fires like traditional tribespeople, or middle-class hippies.
Yes, some African countries are spectacularly badly governed; but I don't think we should rush to a money-saving despair for their peoples.
"Africa’s peoples are outstripping their resources, and causing catastrophic ecological degradation," says Myers. Perhaps, if they do things as they have done before. But on that basis, one would never have predicted the growth of Europe's population to its current size.
One of my relations by marriage went to Kenya to try his fortune some years ago, and having married a local girl from the Kikuyu tribe, bought a farm. His new wife is clever and sent off for pamphlets on farming, from which she learned that you can multiply the productivity of your land by companion-planting several crops. I wonder how much more food Africa could produce if agricultural skills there were better developed and disseminated.
Even in Europe, there are disparities in efficiency. Up to the end of World War 2, my grandfather had a farm in East Prussia. His 600 acres produced at least as much as the 2,000-acre farms of his neighbours. He compounded this advantage by diddling the taxman, telling the latter that as a simple farmer, he didn't understand finance and would the taxman please assess him on what his land could be judged to yield. You may be sure that he paid his tax bill without argument.
And what about modernising energy supplies, too? As a child, I saw a map of the Congo Basin and fantasised about damming the encircling ring of mountain ranges to make the world's greatest hydro-electric project, supplying the electricity needs for the whole of Africa. Of course, I hadn't considered ecological consequences; but in the Sixties, all I ever (over)heard of "ecology" was an brief, excited discussion between two of my teachers. This doesn't vitiate the argument for looking for efficient energy production that doesn't require chopping down all the forests to cook on wood fires like traditional tribespeople, or middle-class hippies.
Yes, some African countries are spectacularly badly governed; but I don't think we should rush to a money-saving despair for their peoples.
Wednesday, July 16, 2008
Bubble economy is beyond satire
My brother sends me a link to this article in the internet satire mag The Onion:
Recession-Plagued Nation Demands New Bubble To Invest In
... The current economic woes, brought on by the collapse of the so-called "housing bubble," are considered the worst to hit investors since the equally untenable dot-com bubble burst in 2001. According to investment experts, now that the option of making millions of dollars in a short time with imaginary profits from bad real-estate deals has disappeared, the need for another spontaneous make-believe source of wealth has never been more urgent....
Has the author read iTulip's Eric Janszen on the "bubble economy"? If he has, he'll know Janszen expects the next craze to be alternative energy - full Harper's article here.
Recession-Plagued Nation Demands New Bubble To Invest In
... The current economic woes, brought on by the collapse of the so-called "housing bubble," are considered the worst to hit investors since the equally untenable dot-com bubble burst in 2001. According to investment experts, now that the option of making millions of dollars in a short time with imaginary profits from bad real-estate deals has disappeared, the need for another spontaneous make-believe source of wealth has never been more urgent....
Has the author read iTulip's Eric Janszen on the "bubble economy"? If he has, he'll know Janszen expects the next craze to be alternative energy - full Harper's article here.
Free trade, or shop local?
An essay on the basic argument for trade, at Mises. But the author does admit a problem with externalised costs that aren't taken into account.
A thought: what if we in the UK really don't have much of a comparative advantage in any area, long-term? Once the East has caught up on skills, what do we have that anyone will want to buy?
And what about the monetary distortions in the market? It's like Monopoly with some players cheating by using secret stashes of extra banknotes.
Are the economists misled by an idealised picture of economics?
A thought: what if we in the UK really don't have much of a comparative advantage in any area, long-term? Once the East has caught up on skills, what do we have that anyone will want to buy?
And what about the monetary distortions in the market? It's like Monopoly with some players cheating by using secret stashes of extra banknotes.
Are the economists misled by an idealised picture of economics?
Will the UK/US trade balance influence the dollar value of sterling?
Here's some trade stats for UK/USA. Last year, we imported $6.6 billion more from the US than we exported to them. Last night, the exchange rate for the pound rose above US$2.00. For some time, we seem to have been shadowing the dollar, but do we have an incentive to allow the dollar to fall further against the pound?
Or will we be more influenced by the desire not to devalue the amount we have loaned to the US via Treasury bonds? And then there is the possible extra unemployment that could result from UK goods becoming more expensive in dollar terms.
Any forex experts care to give a view?
UPDATE: Here's the answer, it seems:
Weak jobs data knocks pound vs dollar and euro (Reuters)
UPUPDATE: ...And here's a different answer:
Sterling up versus dollar, banks support (Reuters)
Wouldn't roulette be more honest, somehow? "Manque! Pair! Impair! Passe! Noir! Rouge! Numero 17!"
Or will we be more influenced by the desire not to devalue the amount we have loaned to the US via Treasury bonds? And then there is the possible extra unemployment that could result from UK goods becoming more expensive in dollar terms.
Any forex experts care to give a view?
UPDATE: Here's the answer, it seems:
Weak jobs data knocks pound vs dollar and euro (Reuters)
UPUPDATE: ...And here's a different answer:
Sterling up versus dollar, banks support (Reuters)
Wouldn't roulette be more honest, somehow? "Manque! Pair! Impair! Passe! Noir! Rouge! Numero 17!"
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