Economische aanraders: Veren of Lood biedt u op zondag wekelijks een inkijkje in (minstens) 15 belangrijke of informatieve artikelen en interviews die vooral de voorafgaande 7 dagen op economisch terrein verschenen op onafhankelijke sites.

De kop is de link naar het oorspronkelijke artikel, waarvan de samenvatting of de eerste (twee) alinea’s hier gegeven worden. Er zijn in deze rubriek altijd verschillende economische scholen vertegenwoordigd, en we streven er naar die diversiteit te handhaven.

We nemen wekelijks ook een paar extra links op naar artikelen die minder specialistische kennis vereisen. Deze met *** gemerkte artikelen zijn ons inziens ook interessant voor lezers met weinig basiskennis van economie.

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Even If the Fed Keeps Pumping Money, We May Still See Deflation – Frank Shostak
11 april
So far in March, the data indicates that the yearly growth rate of our measure for US money supply (as measured by the AMS metric) stood at 10.5 percent against 6.6 percent in February and 1.7 percent in March last year.
Given that the Fed is busy throwing money at the economy as if there were no tomorrow, it is tempting to suggest that the momentum of the AMS is likely to increase further and that consequently runaway inflation could emerge in no time.
However, in response to the massive decline in real economic activity, it is possible that banks’ generation of loans out of thin air, i.e., through fractional reserve lending, could fall sharply.
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Back-of-the-envelope estimates of next quarter’s US unemployment rate – Miguel Faria e Castro
11 april
Workers will inevitably be laid off as a result of measures implemented to limit the spread of COVID-19. This column estimates what the unemployment rate may be at the end of the second quarter of 2020, by combining different types of statistics on industry and occupation composition. It finds that over 52 million people could be unemployed, with a 32.1% unemployment rate.
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The U.S. Labour Market Can Heal Quickly, the European, Less So – Daniel Lacalle
7 April
The jobless claims figures of the past two weeks have been unprecedented and alarming. However, knowing that the data will continue to be concerning, we need to analyze how quickly the economy can can heal and go back to the previous path of record job creation.
The United States economy starts from a comparatively stronger base. Unemployment reached a five-decade low in February and, despite the extremely weak March jobs figure, it stood at 4.4 percent in the first week of April. This compares to a 7.3 percent unemployment figure in the euro area and 6.5 percent in the European Union. In countries such as Spain and Greece, unemployment stood at 13 percent and 16 percent, respectively.
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***COVID-19 vs. the Economy: When is it Time to Reboot? – Wisdom Seeker
11 april
What’s an Acceptable Risk Level? ALARA (“As Low As Reasonably Achievable”) to the rescue?
In this essay I’m going to outline how we can balance between stopping COVID and saving the economy. As I wrote last week, we’ve been bending the curve, but now what? Shelter-in-Place orders have slowed the exponential growth of the virus, buying us time and hope.
But as of April 6, COVID-19 became the leading cause of death in the United States, as shown in the graphic below. That cannot continue.
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What shape recovery? – John H. Cochrane
6 april
Will the recovery be V shaped, quickly roaring back to the previous level? It does that every January 2 after the long Halloween-Thanksgiving-Christmas-New Years slowdown, and it did in 1984. Or will it be an agonizingly slow U or L shape, as the recovery from 2008 turned out to be?
I had early hope for a V, but a fear that shuttered businesses and permanently fired people would turn it into an L. Those take much more time to reorganize. Hence, lots of blog posts advocating a more nuanced policy than a blanket lockdown.
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Welcome To The Greater Depression – Doug Casey
11 april
There are a lot of questions people are asking themselves today. Among them: How serious is this economic downturn likely to be? How long will it last? How can it be ended? Whose fault is it?
The answers to these questions being given by pundits, economists, money honeys, and politicians are, almost without exception, totally incorrect. This is most unfortunate because it means the actions taken by the US (and, it appears, every other government in the world) are not only going to be ineffective but counterproductive.
For years, I’ve predicted something I’ve called the Greater Depression. I’ve seen its arrival as being completely inevitable. Only its exact timing was in doubt.
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Creating More Money Won’t Revive the Economy – Frank Shostak
6 april
In response to the coronavirus, central banks worldwide are currently pumping massive amounts of money. This pumping, it is held, is going to arrest the negative economic side effects that the virus-related panic inflicts on economies. As appealing as it sounds we suggest that this view is erroneous.
The view that more money can revive an economy is based on the belief that money transmits its effect through aggregate expenditure. With more money in their pockets, people will be able to spend more and the rest will follow suit. Money then, as one can see in this way of thinking, is a means of payments and a means of funding.
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The Lockdown Wouldn’t Be So Devastating If Our Economy Wasn’t So Rigged, Brittle and Exploitive – Charles Hugh Smith
7 april
An economy of rackets designed to enrich the few at the expense of the many is brittle because self-serving rackets snuff out competition, accountability and transparency.
What’s remarkable about the lockdown isn’t the hue and cry about the economic damage–it’s the absence of any critical curiosity as to how our economy became so fragile that only the wealthiest contingent can survive a few weeks on savings or rainy-day funds.
A healthy, resilient economy would be able to survive a few weeks of lockdown without a multi-trillion dollar bailout of every racket in the land. A society that wasn’t threadbare financially and socially would be able to function and accept individual sacrifices for the common good.
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Is The “Debt Chasm” Too Big For The Fed To Fill? – Lance Roberts
10 april
Over the last month, the Federal Reserve, and the Government, have unleashed a torrent of liquidity into the U.S. markets to offset a credit crisis of historic proportions. Here is a list of programs already implemented which have already surpassed all programs during the “Financial Crisis.”
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It is currently expected that over the course of the next several quarters, the Fed’s balance sheet will grow to $10 Trillion in total. Such would be a $6 Trillion expansion from the previous levels.
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Globalisation and financial contagion: A history – Olivier Accominotti, Marie Briere, Aurore Burietz, Kim Oosterlinck, Ariane Szafarz
10 april
For many years, globalisation was on the march, bringing with it the increased risk of financial contagion effects. The Global Crisis reversed this expansion and highlighted the vulnerabilities intrinsic to the globalised international economy. This column takes a historical approach to the debate, analysing how patterns of globalisation and contagion have changed over time. The patterns also suggest that the ongoing Covid-19 pandemic is likely to cause another enormous ‘stress test’ for globalisation, forcing firms and nations to limit traveling and trade, perhaps leading to a reevaluation of the international system.
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Life and Health Are at Stake as the Economy Grinds to a Halt – Cory D. Carpenter
7 april
As a data professional with a data governance and data analytics background in multibillion dollar industries, I understand that the messy task of aggregating data from numerous and disparate sources ensures a cloudy data pool, at best. The adage “Garbage in, garbage out” holds true, and anywhere we have human touch points, we have the potential for errors in our data. This is true for all data types, whether medical, automotive, financial, or otherwise.
The WHO and the CDC are still trying to learn about and understand this disease even as they peer through an imperfect data lens. Notably, an Oxford-based group has stopped using the WHO data for coronavirus altogether, stating that they “found many errors in the data published by the WHO.” Many news reports are relying solely on CDC and WHO data. We have to be careful about what we infer from, and how we react to, imperfect data sets, while also being proactive and cautious with the data we have thus far.
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QE-4 Cut in Half this Week. Fed’s Helicopter Money for Wall Street & the Wealthy Hits $1.8 Trillion in 4 Weeks – Wolf Richter
9 april
Regular folks need not apply.
Total assets on the Fed’s weekly balance sheet jumped by $272 billion in one week, to $6.08 trillion, according to the Fed’s release Thursday afternoon. Since the Fed started this spree of Wall Street and asset-holder bailout programs four weeks ago, total assets have exploded by $1.77 trillion.
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Yes, There Are Tradeoffs between Disease Prevention and Economic Destruction – Claus Wiemann Frølund
7 april
The COVID-19 pandemic has really highlighted how differently economists and noneconomists think. All over the world, variations of the same discussion have taken place over the last week or so. It goes as follows. An economist discusses the cost of the governmental responses to the pandemic and is quickly met with accusations of cynically trying to “put a price on a life.” The economist camp tries to explain its reasoning while the noneconomist camp is horrified that anyone would “let old people die to protect the rich” or “prioritize economy over health.”
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Intergovernmental relations: How the global crisis led to further decentralisation – Luiz de Mello, João Tovar Jalles
8 April
The global financial and economic crisis has affected economies and societies, including in the ways governments allocate fiscal, financial, policy and political responsibilities among the different layers of administration. This column describes how, in particular, the crisis was associated with an increase in the subnational shares of general government spending and revenue, which are conventional quantitative gauges of fiscal decentralisation. Effects on subnational authority over politics, policy and fiscal-financial management are more nuanced.
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Why Central Planning by Medical Experts Will Lead to Disaster – Gary Galles
9 april
A great deal of the coverage of the COVID-19 crisis has been apocalyptic. That is partly because “if it bleeds, it leads.” But it is also because some of the medical experts with media megaphones have put forward potentially catastrophic scenarios and drastic plans to deal with them, reinforced by assertions that the rest of us should “listen to the experts,” because only they know enough to determine policy. Unfortunately, those experts don’t know enough to determine appropriate policies.
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Keeping track of the unemployment gap – Pascal Michaillat, Emmanuel Saez
12 april
A lower unemployment rate puts more people into work, but it also makes it harder for businesses to fill their vacancies. This column explores the trade-off between unemployment and vacancies, as captured by the Beveridge curve – a measure which can then be used to estimate the socially efficient unemployment rate for the wider economy. The analysis suggests that the US unemployment rate of 3.5% just before the coronavirus crisis was just about efficient.
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Airline Bailouts Destabilize the Economy and Inflate Asset Prices – William L. Anderson
7 april
In the end, after all of the political posturing and all of the speeches and exhortations for Congress to “do something,” a $2 trillion “coronavirus stimulus” bill landed on the president’s desk for The Donald to sign. And sign he did, uttering all of the platitudes and everything else that comes with “historic” spending legislation that never should have seen the light of day. Although COVID-19 has helped expose vast weaknesses in public health systems in the USA, it also has shown that with much of corporate America, the emperor has no clothes.
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***Preparing for the Aftermath: China’s Airlines Try to Exit Crisis, Alitalia is Nationalized, Qantas Plans 21-Hour Direct Flights – MC01
6 april
The situation is very fluid.
On April 2, the Civil Aviation Authority of China (CAAC) held a press conference in Beijing to update the press about the aftermath of the Covid-19 lockdown. Internal air traffic more than doubled since the depth of the crisis but still operates at only 42% of the capacity it had before the crisis.
The main drivers of this recovery have so far been migrant workers returning from their home provinces to their jobs in big economic powerhouses like Shanghai and Shenzhen. As final restrictions on internal movements will be lifted on April 8, air traffic will begin to pick up at a faster phase, as more aircraft are pulled from storage as demand increases.
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***Entrepreneurship Is the Foundation of a Productive Society – Raushan Gross
9 april
Although there is a proliferation of goods and services brought to markets by entrepreneurially minded producers and investors, this production was preceded by someone or some firm harnessing the power of human capital in order to produce those goods and services.
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Mitigating the work-security trade-off while rebooting the economy – Tito Boeri, Alessandro Caiumi, Marco Paccagnella 9 april
In getting people back to work before a vaccine is developed, policymakers will have to balance medical risks and economic risks. This column presents some calculations on the number of jobs that can be carried out without putting workers at risk of being infected by COVID-19. The findings suggest that the share of jobs that can be performed without putting workers’ health at risk is limited, and probably does not reach 50%. Importantly, this share is even lower in strategic industries that supply the health sector.
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Disclaimer: De VoL-redactie selecteert deze artikelen op interessante inzichten, of naar wij denken nuttige informatie. Wij kunnen echter geen enkele aansprakelijkheid aanvaarden voor de gevolgen van beslissingen die op grond hiervan door lezers zijn genomen, zakelijk zomin als privé.

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