Economic Analysis

Six Ways NIRP Is Economically Negative

Thoughts from the Frontline

August 29, 2016

“Positive anything is better than negative nothing.”

– Elbert Hubbard

“Once you replace negative thoughts with positive ones, you’ll start having positive results.”

– Willie Nelson

Renzi’s Great Gamble

Outside the Box

August 24, 2016

There is an extremely important election coming up, and I am not talking about the US presidential election. The upcoming referendum in either October or November in Italy may have as much or even more macroeconomic impact on the world as the US election, but hardly anyone outside of Italy is paying much attention to it – yet.

I have been saying for some time in interviews around the country that I think the referendum in Italy has even more potential impact than the Brexit vote did in the...

Weapons of Economic Misdirection

Thoughts from the Frontline

August 21, 2016

“Measurement theory shows that strong assumptions are required for certain statistics to provide meaningful information about reality. Measurement theory encourages people to think about the meaning of their data. It encourages critical assessment of the assumptions behind the analysis.

“In ‘pure’ science, we can form a better, more coherent, and objective picture of the world, based on the information measurement provides. The information allows us to create models of (parts of) the world and...

The Globalization Disconnect

Outside the Box

August 17, 2016

There has been a monster debate going on in economic circles as we try to assess the reasons for Brexit/Trump/Sanders and the developed world’s rejection of the directions in which the establishment wants to take us. There are many explanations, which try to spin answers to fit the authors’ own economic or political views; but it all goes back to my thesis that the benefits of globalization, like the future, are unevenly distributed. Those who have been on the short end of the distribution...

An Inheritance of Incompetence

Thoughts from the Frontline

August 13, 2016

Always remember that the future comes one day at a time.”

– Dean Acheson

“Practical men who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist.”

– John Maynard Keynes

“The Bond Rally of a Lifetime”

Outside the Box

August 10, 2016

In 1981, as inflation and Treasury yields were screaming to new heights, good friend Gary Shilling had the audacity to announce, “We’re entering the bond rally of a lifetime.” He was right, as that bond rally is already 35 years old and I think it will see a few more birthdays. Gary’s with us today to assert that the rally is still underway – and to back up that assertion with a rather compelling case for Treasuries and for the “long bond” (the 30-year) in particular.

Gary recalls his famous...

World Gone Backwards

Thoughts from the Frontline

August 7, 2016

 “The growth model China has relied on for the last 30 years – one predicated on low-cost exports to the rest of the world and investment in resource-intensive heavy manufacturing – is unlikely to serve it well in the next 30 years.”

– Gary Locke

“In this 21st century world, some of our country’s most significant exports extend beyond goods and services. They also include innovation, knowledge, discovery, and healing.”

– Kathleen Sebelius...

Toynbee’s Europe

Outside the Box

August 3, 2016

In today’s Outside the Box, Charles Gave offers an incisive and absolutely scathing indictment of the latter-day European project. Harking back to the historian Arnold Toynbee, Charles reminds us that “the role of ‘elites’ in any society is to handle challenges that allow the group to survive and move on to the next phase of their shared journey. If bad solutions are offered up then problems will intensify and pressure will arise for a change in the elite.”

In the postwar era, Charles asserts,...

The Trouble with Trade

Thoughts from the Frontline

July 31, 2016

“When goods don’t cross borders, armies will.”
– Frequently attributed to Frédéric Bastiat

“Free trade agreements are trade agreements that don’t stick to trade.”
– Ralph Nader

“The future has arrived. It’s just not evenly distributed yet.”
– William Gibson, circa 1993 in an interview (original version of the quote)

Crisis Actors and a Reichstag Fire

Outside the Box

July 27, 2016

This week your Outside the Box is from my friend Ben Hunt, who writes his letter under the title Epsilon Theory. This edition is a little darker than usual, and certainly more of a think piece. A central argument that Ben makes in Epsilon Theory is that it is Narrative that is the driver of politics, economics, and social interaction generally. The Narrative is what we all (mostly) believe and act upon. Investors generally believe that quantitative easing is going to result in a rising stock...