A Good, Quick Primer

I am fascinated by monetary policy and central banking and have been since graduate school. My technical analysis skills have weakened over the years and I often struggle to explain some basic things to dinner companions who end up looking at me as if I have three eyes. Bruce Bartlett has written a pretty good, quick read on how failings in monetary policy (made worse by failings in fiscal policy) caused (that's right, caused) the Great Depression. Not capitalist greed, not political avarice, failed monetary policy.

Seriousy, Stop Worrying about Hyperinflation

The title says it all. This is a pretty good summary of the forces that will restrain the government from inflating away the debt. Of course, how we pay for it is a different matter.

How It Looked From the Inside

Steven Rattner's tale of the bankruptcies of GM and Chrysler.

Job Losses in Motion

No commentary needed.

Will You Know It When You See It?

This is, by definition, fascism in action. If you think not then I ask that you read up on the economic policies of Benito Mussolini.

Wow!

And that's all I have to say about that!

Gramm-Rudman - zzzzzzzzzzzzzz

One of the better ideas I've seen in a while and here's the money quote.

"By setting annual deficit ceilings as a share of the economy, Congress would have more incentive to adopt pro-growth economic policies and avoid anti-growth policies such as increasing tax rates on work effort and investment or raising taxes on energy."

Oh, and by linking this, I am officially boring.

Australia Hops

Australia's central bank has raised its lending rate by 25 basis points. I read a very interesting economic commentary (no link, unfortunately) that speculated that the best way a central bank can halt an economic decline is to publicly declare a floor on interest rates and hold to it. A central bank that continually lowers rates also continually sets an expectation that an economy is bad and getting worse. The thinking was that setting a rate floor creates a psychological floor as well. Is it true? I don't know but Australia may be giving us a clue.

The Forecast

Cannot and Does Not

Here's an interesting piece of research on Keynesian spending and whether or not it actually produces results. Does government spending for the purpose of raising gross domestic product actually work? The conclusion of the authors is that it does not.