I Keep Hoping Larry Summers Is Wrong. What if He’s Not?
https://podcasts.apple.com/gb/podcast/i-keep-hoping-larry-summers-is-wrong-what-if-hes-not/id1548604447?i=1000555567714
Lone Candle
Champion of Truth
https://podcasts.apple.com/gb/podcast/i-keep-hoping-larry-summers-is-wrong-what-if-hes-not/id1548604447?i=1000555567714
https://www.yahoo.com/news/us-delivers-phoenix-ghost-drone-170432101.html
“The economic fallout from the pandemic and attendant shutdowns and disruptions has widened a divide between low-wage workers — who have been forced to keep working in person, leaving them vulnerable to the virus and financial troubles — and high-wage workers. Behind all of this, climate change has caused more flooding in Gulf Coast states, wildfires in the West and other problems worldwide. Now, Russia’s invasion of Ukraine feels even more destabilizing.
So given all of this, how are Americans doing?
The answer is, surprisingly, kind of OK. People in general are resilient and optimistic and can find ways to thrive even in the worst of times. But that doesn’t mean that Americans are optimistic about the direction of the country. This was hinted at in a January Gallup poll in which a full 85 percent of respondents said they were satisfied with their own lives, while only 17 percent were satisfied with the direction of the country. That disconnect, though, isn’t unusual. Since Gallup began asking that question in the 1980s, the share of Americans who say they’re “somewhat” or “very” satisfied with their personal lives has been fairly stable, ranging anywhere from 73 percent to 90 percent, while satisfaction in the direction of the country has generally been lower and less stable.”
“An immediate, full-blown ban imposed by the EU on oil is still a no-go for economic powerhouse Germany. Berlin has indicated to other EU capitals it’s ready to consider cutting Russian oil — even if it is not yet able to abandon imports of gas — but only under specific conditions, which are now being discussed with the European Commission.”
“whether Emmanuel Macron or Marine Le Pen is victorious, the election already offers more evidence of the challenges facing mainstream politics, with the collapse of the traditionally dominant parties and populist forces still rising across the West.”
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“Whether this broad rejection of the status quo means we are headed toward a world dominated by illiberal politics or merely one of extreme and permanent volatility isn’t yet clear. And new crises, notably the consequences of climate change, may well fashion some hybrid version of our politics.
But ultimately, populism is probably a transition, not an end-state. The politics of the center are far from irrelevant, but our institutions — overwhelmed by the politics of accusation and resentment — no longer know how to provide voters with reasonable and legitimate means to address their grievances from a centrist vantage point. So populism, however destructive, may yet force Western politicians to craft new institutional paths to representation and to compromise — more in sync with what people experience in their everyday lives, and with what they value. More reactive, more local, and more flexible. But a painful and treacherous transition it is, something made quite clear in the French election.”
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“Macron is no longer the exciting young maverick who stormed the Elysée, having siphoned support from a frustrated center-left and scandal-plagued center-right. He’s struggled to govern through crises like the Yellow Vests protests and pension reform strikes, while his “Jupiterian” approach and occasional sarcasm have all led to a deep resentment of his persona and some outright loathing in many quarters.
Post-pandemic, most French voters might have grudgingly agreed that Macron’s government has “done OK,” and as a result, Macron entered this election well ahead of other candidates in the polls, and slightly boosted by the Ukraine crisis. But a majority of voters are at best disillusioned and most often angry.
Meanwhile, in five short years, Le Pen has furthered her mission to appear more mainstream. Gone are the days when 80 percent of French voters thought she and her far-right party were a menace to democracy. Today, the number is barely 50 percent.
Le Pen’s strategy (since she took over the party from her Holocaust-denying father in 2011) has been to focus on lower income voters. Rather than simply woo those susceptible to a traditional populist right agenda on immigration and integration as her father had done, she made a play for working class voters who increasingly felt that the traditional left had deserted them and their interests. This story is a familiar one in advanced democracies where progressive or social democratic parties have struggled to reconcile representing the economically vulnerable while supporting inclusive visions of societies that lower income voters feel disproportionately benefit an (urban, cultural) elite. We saw this play out in the Brexit vote, but also in the Trump vote.”
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“In 2017, Macron was elected by reducing the Socialists to rubble and putting the center-right on life support. This year, that trend accelerated, as the Socialists’ candidate came in below 2 percent (after holding the presidency a mere five years ago) and the leading candidate of the center-right came in under 5 percent. The result is that Macron aside, the candidates from the main institutional parties have been wiped out in this election.
Of the three candidates who came in over 20 percent, one is of the populist right (Le Pen) and one is of the populist left (Mélenchon); both advocate a distanced relationship with the EU and with the U.S., governance by popular referendum and pulling out of NATO or NATO’s integrated command. Add to this the 7 percent for extreme right Éric Zemmour and the 26 percent of voters who stayed home, and it shows the vast majority of French voters are refusing to engage with mainstream politics.”
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“Part of the attraction of illiberal ideologies (sometimes imported from places such as Russia and China that have gone through more recent political and economic upheavals) is their rejection of the status quo. What is coming into focus is the fact that voters have a bone to pick not just with the choices they are being offered, but with the way they are being asked to choose.”
“That is saying a lot, because the scientific justification for the TSA’s rule has always been weak, given that the conditions on airplanes are not conducive to COVID-19 transmission. The ventilation systems on commercial aircraft, which mix outdoor air with air recycled through HEPA filters and limit airflow between rows, help explain why there were few outbreaks associated with commercial flights even before vaccines were available.
“The risk of contracting COVID-19 during air travel is low,” an October 2020 article in The Journal of the American Medical Association noted. “Despite substantial numbers of travelers, the number of suspected and confirmed cases of in-flight COVID-19 transmission between passengers around the world appears small.”
Sebastian Hoehl, a researcher at the Institute for Medical Virology at Goethe University Frankfurt in Germany, concurred in an interview with Scientific American the following month. “An airplane cabin is probably one of the most secure conditions you can be in,” he observed.”
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“On February 25, the Centers for Disease Control and Prevention (CDC) stopped recommending general indoor masking in parts of the country it rates as “low” or “medium” risk, which as of last week covered more than 98 percent of the U.S. population. According to the CDC, then, it is safe to dispense with masks in stores, churches, schools, bars, and restaurants—environments where the risk of virus transmission is much higher than it is on airplanes.
Yet the TSA said it extended its mask rule “at CDC’s recommendation” so the agency could develop “a revised policy framework” based on “the latest science.” Mask rules for transportation are complicated, said Jen Psaki, the White House press secretary, because people are “moving from one zone to another”—an explanation that makes little sense when virtually the entire country is in the same “zone” as far as the CDC’s mask advice goes.”
https://www.vox.com/2022/4/10/23019045/macron-le-pen-france-presidential-election-first-round
“Republican Texas Gov. Greg Abbott’s short-lived policy of requiring state troopers to conduct secondary inspections of trucks crossing into Texas from Mexico cost the United States almost $9 billion in just 10 days, Axios reported Tuesday.
The policy, which Abbott enacted on April 6, snarled truck traffic at the border and led to a protest by Mexican truckers that stopped trade at some major crossings. On April 15, Abbott ended the double inspections, for which he’d received withering criticism from both sides of the border and the aisle, after striking deals with the governors of the four Mexican states that border Texas.
Per Axios, Abbott implemented the policy “in response to the Biden administration’s announcement that it would lift Title 42,” a Trump-era public health policy that denied migrants entry into the United States.
An analysis by the Perryman Group showed that the U.S. lost an estimated $8.97 billion in GDP due to delays at the border, while Texas alone lost $4.23 billion.”
https://www.yahoo.com/news/russia-hits-ukrainian-cities-pours-040632802.html
“Partisans in the inflation battle frequently fail to acknowledge that their stories are not mutually exclusive. If public policy boosts demand while production bottlenecks hamper supply, there is no question about what happens to prices—up they go. Digging further into the debate provides additional reasons to eschew confident assertions.
Orthodox economic theory says fiscal and monetary stimulus can increase total spending, or what economists call aggregate demand. We’ve certainly had lots of both. The American Rescue Plan Act, signed into law by President Joe Biden on March 11, 2021, had a top-line figure of $1.9 trillion. Expansionary fiscal policy, meaning increased government spending to boost output and employment, requires deficit spending, because financing outlays with taxes blunts the effects on aggregate demand.
At the same time, the Fed’s balance sheet has surged. Total assets held by the central bank grew from roughly $4 trillion in early 2020 to $8.9 trillion as of late January. Driven by these asset purchases, the M2 money supply—cash, checking accounts, and “near monies,” such as savings accounts and money market mutual funds—grew from $15.5 trillion in early 2020 to more than $21.6 trillion today. So Americans definitely have more money to spend.
It is also true that fiscal and monetary expansion don’t boost supply of the goods people might want to buy with that money. Widespread COVID-prevention policies threw a wrench into the economy’s gears. Transportation gridlocks on sea, on land, and in the air make production and distribution harder. Major inputs, such as semiconductors, are frustratingly scarce. There are also frictions in labor markets, such as recently boosted unemployment benefits and union disputes over vaccine mandates. The combined effect is rising prices, independent from demand considerations.
A supply-and-demand double whammy could explain inflation. But both stories have problems.
On the demand side, all that stimulus might not be as expansionary as it appears. “We know from experience that budget deficits, by themselves, are not very inflationary,” writes Scott Sumner, the doyen of the market monetarist school, in his new book The Money Illusion (University of Chicago Press). Sumner cites the absence of major inflation during the Reagan and Obama administrations, both of which presided over growing budget deficits.
Nor was money especially loose during the early stages of the pandemic. As the money supply ballooned, the velocity of money—its average rate of turnover—cratered. People held on to that extra money. According to data from the Federal Reserve Bank of St. Louis, money demand increased by 22.5 percent from the fourth quarter of 2019 to the first quarter of 2020. Velocity remained depressed as the money supply continued growing. Since supply outpaced demand, monetary conditions did loosen. But Fed policy did not open the liquidity floodgates, as many initially supposed.
As for the supply of goods, congested production and slowed distribution clearly are making inflation worse. But this explanation is prone to just-so stories. Supply conditions vary greatly by sector. Aggregate data, constructed to get a fuller picture, is not as clean on the supply side as on the demand side.
We also have to consider politics. Behind the inflexible insistence that supply problems matter most lies a possibly partisan reluctance to indict policy makers and technocrats.
The doves are down, but they are not out for the count. Market inflation expectations peaked in mid-November. As of January, bond traders forecast 2.8 percent per year for the next five years, meaning they are not convinced runaway inflation is our destiny. “Predictions are hard, especially about the future,” a wise man once said. Much will depend on how fast supply constraints loosen and Fed policy tightens.”