economic theory

A key to understanding the news: the unexpected rules in our age of wonders.

Summary: We’re in an age of wonders where the news overflows with unexpected events, things not predicted by even our greatest experts. Today we discuss two common responses to this, both ineffective: blindly accepting experts’ explanations that it’s all understood, and throwing away their advice as imperfect. There is a third and better way.  {2nd …

A key to understanding the news: the unexpected rules in our age of wonders. Read More »

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Look at the economy. Fight the illusion of normality. Feel the weirdness.

Summary: I don’t believe I’ve successfully communicated to our readers the extraordinary nature of our times. We too often focus on the details, but ignore this essential aspect of our situation. Since the crash (perhaps starting even before) we’ve sailed beyond the edges of the known economic “space”. We can no longer even see the …

Look at the economy. Fight the illusion of normality. Feel the weirdness. Read More »

A guide to the weird numbers that run our world, describing financial bubbles & climate change.

Summary: Two of our greatest challenges in the 21st century are climate change and management of economic crises. They’re similar in that their mathematics are unlike that of the normal life — the routine world of averages, variances, and bell-curve distributions. These phenomena take us deep into the mysteries of science. Before we can predict …

A guide to the weird numbers that run our world, describing financial bubbles & climate change. Read More »

How to predict the outcome of this great monetary experiment, and how we got into this box

Summary: Today we discuss the nature of the great monetary experiment now under weigh, with five years of zero interest rates and repeated doses of quantitative easing. What does it mean to say this is an “experiment”? If we cannot reliably predict the outcome, at least let’s understand how we got into this predicament. . …

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What about the past and future effects of the economic stimulus?

Summary:  Yesterday we examined the condition of the US economy. Today we look at a major driver of our prosperity, and what might be its long-term effects. . Contents How we got here What do we have to show from 5 years of massive stimulus? Why continue the stimulus? Putting the stimulus in perspective For …

What about the past and future effects of the economic stimulus? Read More »