Economy News

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Established 1999

New England, USA

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    Keynes vs. Hayek: The Great Debate Continues

    The debates raging over what policies will pull the U.S. economy out of its Great Recession replicate one that occurred during the Great Depression. Thanks to the efforts of Richard Ebeling, a professor of economics at Northwood University, we have compelling and concise documentary evidence. He has unearthed letters to the Times of London from…

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    “Liquidity Trap or Malinvested Resources?”

    “Many people claim today that the U.S. economy is in a “liquidity trap” and only government can spend us out of this mess. Commentators from Paul Krugman to Martin Wolf of the Financial Times assert we are in a “Keynesian situation”; unless government spending rescues us, we are doomed to suffer decades of economic stagnation.…

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    The Age of Turbulence

    “Alan Greenspan shares the story of his life first simply with an eye toward doing justice to the extraordinary amount of history he has experienced and shaped. But his other goal is to draw readers along the same learning curve he followed, so they accrue a grasp of his own understanding of the underlying dynamics…

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    The U.S. Debt Burden

    In the aftermath of the financial crisis, the U.S. public debt-to-GDP ratio has been receiving special attention. A recent report from the Treasury to Congress said that the ratio of total government debt to nominal GPD will rise from 93 percent this year to 102 percent by 2015. The report also concludes that the net…

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    “Fed’s Fisher sees slower U.S. Growth Ahead”

    “In the second half of 2010, the U.S. will experience “slower economic growth than we’ve had in the first and second quarter,” Fisher told the Japanese business daily Nikkei. He estimated U.S. growth of 2%-3%, saying that the figure will likely come “closer to the low end of that range.” Fisher is not a voting…

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    Lessons Unlearned

    On Wednesday, I posted a link to F.A. Hayek’s “The Use of Knowledge in Society”. Like Leonard Read’s “I, Pencil”, Hayek’s knowledge paper explains why it is impossible for an economy to be centrally planned. I have mentioned this idea in earlier posts, but it is always worth mentioning again as the lessons learned never…

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    “China’s Wen Says Economy Heading in Right Direction”

    “China’s government said the world’s third-biggest economy is heading in the right direction and business people and economists expect “relatively fast” growth to continue. Premier Wen Jiabao said the nation will “further cement and develop the positive economic trend,” in a statement posted on the government’s website today. He pledged both continuity and flexibility in…

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    “Chicago Fed’s Evans ‘wary’ of more asset purchases”

    “”There are limits to what policy can do,” especially to improve the nation’s labor market, Evans said in a television interview on CNBC. Interest rates are near zero as the Federal Reserve’s stuck with an accommodative monetary policy, and it’s already purchased $1.75 trillion of housing-related assets to keep long-term market interest rates low.” Read…

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    “Freshman GOP senator finds pivotal role on financial regulation”

    “With the House of Representatives poised to vote on the latest version of financial regulation perhaps as soon as late Wednesday afternoon, the political spotlight has turned to a Republican senator who has been in office for less than five months and who forced what the Obama administration had hoped would be an immediate major…

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    “Worst Still Ahead for Economic and Systemic-Solvency Crises”

    “The U.S. economy continues in its longest and deepest downturn since the early 1930s, the first downleg of the Great Depression. This structural contraction already shows characteristics of a depression. Particularly protracted and deep, it will remain unresponsive to traditional economic stimuli. Given the historical and current extreme fiscal malfeasance of the U.S. government, and…