Category Archives: Uncategorized

The Economic Policy Institute (EPI) is holding a conference on shadow banking today (program here).  NEP’s own Randy Wray is on the afternoon panel.  You can watch the entire LIVESTREAM below.

By Dan Kervick

As I write, American conservatism has gone mad: openly, disturbingly and resoundingly bats. There is no mistaking it. But the furious imprecations and cracked laughter of the lunatic conservatives echoing loudly down the halls of our sad American bedlam have helped obscure the fact that liberalism in the United States is moribund.  While conservatives strive to tear down our rotten and unjust system and replace it with something even more terrifying, liberals offer nothing but a determination to patch up some of the superficial rot while approving the general injustice.

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By Dan Kervick

Evan Soltas is hoping that President Obama’s appointment of  Janet Yellen signifies a new administration commitment to jobs and economic growth.  Unfortunately, Soltas seems to be one of those folks who is convinced that our failures over the past five years have much to do with a monetary policy that has been insufficiently “accommodative”, and he strongly suggests that the national plague of mass joblessness and stagnation could be alleviated if the Fed would only do more aggressive quantitative easing without political pressure to taper prematurely.

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By Dan Kervick

I take time out from our latest national celebration of curmudgeonly misery and political decadence, which features an intense bipartisan struggle over whether to cling to liberal or conservative forms of long-term economic stagnation, in order call the reader’s attention to an economist whose innovative ideas are so insightful, so well-informed and so right that they stand in terrifying contrast to almost everything that most Americans in 2013 hold dear.

The economist is Mariana Mazzucato of the University of Sussex, who recently presented several of the leading ideas from her new book, The Entrepreneurial State, to an audience at the London School of Economics. Mazzucato ties a vast number of themes together in a sparkling, rapid-fire talk followed by a stimulating round of Q&A. Among the economists who come in for discussion along the way are Polanyi, Keynes, Schumpeter, Stiglitz and Krugman. Mazzucato pulls no punches on the inadequacies of bastard Keynesianism with its limited emphasis on economic pump-priming, and on the dead-enders of neoliberal thought represented, for example, by the editorial staff of The Economist magazine. Here is the link to the presentation:

Mazzucato at the LSE

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By Dan Kervick

The Bitcoin phenomenon has always been an interesting concoction: part radical libertarian currency scheme inspired by the anti-government monetary musings of Ron Paul and Austrian school of economics; part black market drug exchange empowered by a hackertopian computer architecture providing anonymity to its aliased participants; and part speculative Ponzi-scheme-in-the-making based on a strange built-in deflationary coding that seems designed to make its early adopters filthy rich – if they can somehow succeed in getting enough other suckers Bitcoin enthusiasts to buy in.

The speculative dimension of Bitcoin has sometimes crashed up against its alt-monetary aspirations in comical ways, as was noted earlier today by John Carney:

Was talking to someone with large amount of bitcoins that he isn’t spending b/c “that would be giving away money.” #tulipmania

— John Carney (@carney) October 2, 2013

But now Bitcoin has really broken bad in a whole new direction, as federal prosecutors have indicted one of the Bitcoin marketplace’s star performers for a variety of crimes, including conspiracy to commit murder.  The FBI claims to have unmasked and apprehended the man behind the Bitcoin-powered online drug market Silk Road.  His name is Ross William Ulbricht, and the charges are rather amazing:

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By Dan Kervick

Various types of backlash appear to be growing against Lawrence Summers in the political fight over who should be the next chair of the Federal Reserve Board of Governors.  Josh Barro reports on a research note from BNP Paribas saying that “if President Obama picks Larry Summers as the next Federal Reserve Chairman, he will do serious harm to the U.S. economy.” Binyamin Applebaum develops similar themes in the New York Times.  And Paul Krugman worries that a Summers appointment won’t produce enough media shock and awe to signal a “regime shift” and awaken the confidence fairies from their slumbers.

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By Dan Kervick

Provoked partly by some recent posts by Paul Krugman, which seem to imply that understanding the institutional structure of the banking system is irrelevant to gauging the effectiveness of the monetary policies implemented by the central bank, questions have arisen again about the relationship between bank lending and bank reserves.  One of the issues raised can be framed by asking, “Do banks lend their reserves?”  And as with so many questions in economics, the answer to this question depends on disambiguating the question, clearly distinguishing parts from wholes, and avoiding fallacies of composition and division.

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