There’s an excellent post by John Carney, CNBC’s Senior Editor, on the mechanics of lending, deposit creation, and how these interact with regulatory and capital requirements. Highly recommended:
http://www.cnbc.com/id/100497710
I’ll have a crack at modeling this in Minsky shortly; I have already done a similar model to illustrate why reserves lag deposits in almost all countries, so it shouldn’t be too difficult to knock this illustration up in it.
I was going to write a piece about how Paul Krugman doesn’t understand IS-LM today, but as often happens when I read Krugman, I find myself agreeing with him – even if our approaches to economic analysis are very different.
INET is holding a graduate student workshop prior to its upcoming plenary conference in Hong Kong on April 4–7.
The 2‑day workshop consists of a mini course in 20th century history of economic thought and another mini course on statistical learning. Plus, there will be student presentations. INET covers expenses for travel and hotel — this should be quite attractive for students. Details here:
http://ineteconomics.org/ysi-
Students have to apply online (follow link above). The deadline for application is Feb 24, so please hurry!
I’m speaking at a lunchtime seminar for the Economic Society of Australia NSW Branch on Thursday February 28th, in the Ground Floor East Seminar Room of the Reserve Bank of Australia in 65 Martin Place Sydney. The function will start with light refreshments at 12.15pm, with a 12.30pm start; it will finish between 1.15pm and 1.30pm.
My topic is “Explaining the Crisis Using Private Debt and Aggregate Demand” (see the abstract below). It’s free for members; if you’re not one, I expect that you would have to join the society to be able to attend. If you’d like to attend, send an email to ecosocnsw@ecosoc.org.au.
Economists are wont to criticise habits as a sign of irrationality, but they’re often a sensible rule of thumb that stops us doing other things we’ll later regret.
A case in point: over the years, I’ve developed the habit of not reading Ross Gittins. Last week I broke that habit, and the experience reminded me of how sensible that habit was.
Click here to read the rest of this post
Help reform economics. Kickstart Minsky now!: http://t.co/rzFwjEnJ
The Kickstarter campaign to raise funds to further develop “Minsky”, my dynamic monetary simulation program, has been launched. The immediate objective is to raise $50,000, which will enable the current version of Minsky to be completed. The ultimate goal is to raise $1 million or more to fully develop the concept.
Click here for the Kickstarter campaign. If you have appreciated my work over the last seven years to warn about the economic crisis, to develop an approach to macroeconomics that can understand why it happened, and to develop policies that might help end it, the please show this by making a pledge.
Early on Saturday morning New York time, I’m launching a Kickstarter campaign to raise funds to further develop my Minsky modeling program. The draft pitch can be seen here (until the actual one goes live):
Draft Kickstarter Minsky campaign
This post is to give a quick “what it is and why it’s new” overview of Minsky via ten videos in a Youtube playlist.
As I wrote just before the data was released, I expected house prices to rise at a level “either below or barely above CPI inflation”:
The ABS House Price Index Data will published at 11.30am today. My Mortgage Accelerator data indicates that it will show a further rise in house prices—though at an anaemic level of either below or barely above CPI inflation.
In fact, the numbers came out spot on at the rate of CPI inflation over the previous year:
Here’s the chart I published before the figures were released:
The ABS House Price Index Data will published at 11.30am today. My Mortgage Accelerator data indicates that it will show a further rise in house prices—though at an anaemic level of either below or barely above CPI inflation.
The correlation coefficient between these two series is 0.853.
Recent economic data from both the UK and US should have taken the wind out of the sails of those in the Anglosphere who – despite clearly contradictory evidence from mainland Europe – continue to argue that fiscal tightening is needed for economic growth is to recover.
The UK, which has followed a fiscal austerity path right from the election of the Conservative-Liberal coalition government in mid-2010, recorded a 0.3 per cent fall in the last quarter of 2012, while the US recorded a 0.1 per cent fall (mainly on the back of declining government expenditure). Getting the government sector out of the way and letting the private sector rip clearly isn’t going according to script, even when you can’t blame Brussels for the policy.
