Economics - General
« Previous EntriesWind
Saturday, May 17th, 2008It’s hard to know how to keep up with news on the problem of mitigating CO2 emissions - there’s just so much happening - so I’m just going to jot down a few thoughts. This piece on wind power in Salon by Joseph Romm has a couple of particularly interesting snippets I want to jot [...]
After the dollar
Saturday, May 10th, 2008It’s unclear whether we are bound for a Post-American World in the near future, but it seems pretty clear that we are bound for a world in which the US dollar is no longer the unique ‘reserve currency’. The combination of chronically large trade and budget deficits and willingness of the US monetary authorities to [...]
Data and anecdotes
Thursday, May 1st, 2008Among the outcomes produced by a market economy, real wages are arguably the most important single variable for most people. With inflation rising around the world, and sensitive prices like those of food and petroleum going up a lot, most people’s living standards depend mainly on whether wages grow faster than prices. I got a [...]
Videoseminar today at ANU
Tuesday, April 29th, 2008Sorry again for late notice, but I’ll be presenting a video seminar 1pm today at ANU on intergenerational equity. For details contact Ralf Steinhauser on ph: 61 2 6125 4667.
Report: This was a bit of a bleeding edge experience, though it worked OK in the end. The big problem was presenting slides at the [...]
One less stupid idea to worry about
Tuesday, April 29th, 2008The Queensland government has abandoned the idea of piping water from the Burdekin to the Southeast corner. A $350 000 study by GHD concluded that the proposal would be ruinously (as in $14 billion) expensive. I could have told them that for free, just by looking at the studies on Colin’s canal. Still, the [...]
Guest post from John Mashey
Friday, April 18th, 2008I got a very long comment from John Mashey caught in moderation, so I’ve decided to put it up as a guest post. John makes a number of important points, but doesn’t convince me that oil is essential to economic activity, for reasons I hope to spell out in a reply. In the meantime, readers [...]
Food
Wednesday, April 16th, 2008The big increase in food prices over the last six months or so raises lots of issues, of which I’ll try to cover a few.
The first arises from the fact that prices for commodities, including oil as well as most ag commodities, are typically quoted in $US. In a situation where, for obvious reasons, the [...]
The secret case for privatisation
Tuesday, March 18th, 2008Ross Gittins had a piece in the SMH yesterday offering an intriguing line of defence for the privatisation proposals of the Iemma government, in the face of attacks from me and Nicholas Gruen. As Gittins concedes Iemma’s arguments, based on the idea that the sale will protect the states AAA rating and allow for new [...]
White knights
Monday, March 17th, 2008It’s just been announced that JP Morgan will buy Bear Stearns for $2 a share, implying a value of about $250 million. Given that the company headquarters is said to be worth about $1.2 billion, that gives the BS banking business a value of negative $1 billion. And that’s only after the Fed agreed to [...]
The one-hoss shay
Sunday, March 16th, 2008The Fed’s bailout of Wall Street investment bank Bear Stearns has, unsurprisingly, been discussed in terms of the domino theory. A more appropriate metaphor is The Wonderful One-Hoss Shay . This was a carriage constructed on the theory that a system always fails at its weakest spot.
he way t’ fix it, uz I maintain, Is [...]
Two economies
Tuesday, March 11th, 2008The Australian economy is still booming, but the shadow of the global credit crisis is growing longer every day. Some items
* Most observers now agree the US is in recession
* With negative real interest rates in the US for terms up to five years (you can actually buy negative-rate inflation-protected bonds) commodity price inflation seems [...]
After the ratings agencies
Saturday, March 8th, 2008Among the likely casualties of the emerging financial crisis, the ratings agencies (Moody’s, Standard & Poor’s, Fitch) have to be near the top of the list. The crisis has exposed fundamental weaknesses in the way in which ratings are determined and adjusted. The privileged position held by these agencies can no longer be justified. it’s [...]
Buying back water
Tuesday, March 4th, 2008My Fin column last Thursday was on the Rudd government’s announcement of a tender to buy irrigation water rights, with the resulting water to be managed for environmental flows. This is a long overdue step
A lot or a little, part 2
Sunday, March 2nd, 2008This CT post on Stiglitz and the cost of the Iraq war reminded me to get going on one I’ve had planned for some time, as a follow-up to this one where I pointed out that the $500 billion in aid given to Africa over the past fifty years or so is not, as is [...]
Lowering the NAIRU
Tuesday, February 19th, 2008Among the relatively few points the opposition has scored in this Parliament has involved the unwillingness (or, in the Opposition’s telling, inability) of Treasurer Wayne Swan to respond substantively to a question from Malcolm Turnbull about the level of the NAIRU (non-accelerating inflation rate of unemployment), AKA “the concept formerly known as the natural rate”.
At [...]
Here comes the big one
Sunday, February 17th, 2008My column in last week’s Fin was about the spreading crisis in financial markets. In the same week, we saw the first indication* that the crisis was spreading to the market for credit derivatives. The possibility of a full-scale financial crisis arising from these markets, which financial market bears have been talking about for years. [...]
One-percenters underbid by McKinsey
Friday, February 15th, 2008I’ve put up quite a few posts supporting the conclusion of the Stern review that large cuts in C02 emissions could be achieved at very modest economic cost. Mostly, the analysis has focused on policies aimed at reducing developed country emissions by 30 per cent by 2020 and 60 per cent by 2050, and the [...]
AARES
Thursday, February 7th, 2008I’ve been at the annual conference of the Australian Agricultural and Resource Economics Society for the last few days. I’ve been coming to these for nearly 30 years, and it’s always good to catch up with old friends and colleagues. For many, it’s the first time they’ve seen me without a beard, and quite a [...]
Howard’s economic record
Wednesday, February 6th, 2008If there was one thing John Howard and Peter Costello could reasonably have expected as part of the historical judgement on their terms as PM and Treasurer, it was a positive assessment of their record as economic managers. But a game isn’t over until the final whistle, and the last few months have produced some [...]
The Great Australian Dream
Saturday, February 2nd, 2008I’ve been meaning for ages to write a post about house prices, but haven’t come up with an analysis that satisfies me. Still, here goes.
On most standard measures. Australian house prices have been far above their long-run equilibrium value for at least five years, and the gap seems to be widening. But the length of [...]