fiscal policy and NGDP policy

Monetary Policy in a Low R-star World by John C. Williams

Nominal Demand Ain't What It Used to Be by David Beckworth

A Thought Provoking Essay from Fed President William by Larry Summers

Slow Learners by Krugman

Van Jones on Hillary's challenges

Van Jones on the staggering political challenges Hillary Clinton would face as president

Infrastructure, Cassidy and Krugman

AN INFRASTRUCTURE PROPOSAL THAT GOES BEYOND CLINTON AND TRUMP by John Cassidy

Wisdom, Courage and the Economy by Krugman

Now, I’m not saying that we shouldn’t try. I’d argue, in particular, for substantially more infrastructure spending than Mrs. Clinton is currently proposing, and more borrowing to pay for it. This might significantly boost growth....

Beckworth and Bernstein comment on Williams's NGDP targettting comments

The dollar’s makin’ me holler, and other tales of the macro muddle by Jared Bernstein

Nominal Demand Ain't What It Used to Be by David Beckworth

Trump voters and economic anxiety, Kwak and DeLong

That “Massive New Study” Says Nothing About Economic Anxiety by James Kwak

Must-Read: Martin Sandbu: Trump Supporters on the Couch:
by DeLong

Economic anxiety can make voters more prone to racial resentment... 

It is, of course, an old trope in social thinking that economic pressure makes it easier to wind masses up against a scapegoated group perceived as “other”. Conversely, times of widespread and rising prosperity are good for liberalism and tolerance. Brad DeLong is quite right that this is a good time to pick up Ben Friedman’s prescient pre-crisis work on the moral consequences of economic growth.... 

Racial status anxiety and economic anxiety can be one and the same phenomenon, insofar as the economic pressure is perceived as affecting a particular social group. Much is said, all correct, about how the American white working class, and Trump supporters in particular, are well off compared with minorities and the real poor. But over the past generation, the trajectory of the white working class has no doubt changed the most for the worse, compared with the previous generation. 

That is true in material, indeed plain physical, terms: while black mortality rates remain higher than those of whites, it’s only for the white working class that the secular mortality decline has gone into reverse. And it is surely true that, as a result, the relative social status of working-class whites has fallen noticeably. That reflects a sharpening of class difference with widening inequality and an unequivocally welcome reduction in racial status difference. 

All told, that is a story of tremendous progress. But there is no need to dismiss the economic roots of the racial backlash we now see...

the decline of unions and Trump

The Decline of Unions and the Rise of Trump by Neil Gross

For millennial voters, the Clinton vs. Trump choice ‘feels like a joke’ by Philip Rucker

Reich on the Democrats

Why the Shake-up at the Democratic National Committee Is Doomed by Robert Reich

Moody's and Romers on Clinton and Sanders; JW Mason on CBO

The Macroeconomic Consequences of Secretary Clinton’s Economic Policies by Moodys

SENATOR SANDERS’S PROPOSED POLICIES AND ECONOMIC GROWTH by Christina and Paul Romer

CBO Forecasts: What’s Under the Hood? by J.W. Mason

Hillary and the Scandinavian-American Dream

Hillary Clinton and the Scandinavian-American Dream by Bo Lidegaard

Tulsi Gabbard nominates Bernie Sanders

Dianne Abbot at DNC convetion in Philly

Day One of the Democratic Convention by Dianne Abbot

There is lot of interest in Jeremy Corbyn here. Most of the nonsensical British media coverage has not impacted on ordinary Americans and they see him as a progressive insurgent on the Sanders model with Sanders uncanny ability to enthuse idealistic young people. Sanders’ program, with priorities like a higher minimum wage, government health care, breaking up big banks and rebuilding infrastructure, is also very similar to the current Labour leadership.

John Cassidy on Democratic convention

BERNIE SANDERS GOES ALL IN FOR HILLARY CLINTON by John Cassidy

WHY SOME OF BERNIE SANDERS’S SUPPORTERS ARE ANGRY by John Cassidy

Amy Schumer and 2016 Emmy nominations

Schumer loves Orphan Black

My favorites:

Lead actress in a drama:

Tatiana Maslany, “Orphan Black”

Also good:
Keri Russell, “The Americans”

But Maslany should win!!!

Lead actor in a drama:
Rami Malek, “Mr. Robot”
Bob Odenkirk, “Better Call Saul”
Matthew Rhys, “The Americans”

Liev Shrieber, "Ray Donovan" is good too.

Lead actor in a limited series:
Bryan Cranston, “All the Way”

Lead actress in a limited series:
Kirsten Dunst, “Fargo” | Video

Lead actor in a comedy:
Anthony Anderson, “black-ish”
Will Forte, “Last man on Earth
Thomas Middleditch, “Silicon Valley”
Jeffrey Tambor, Transparent

Lead actress in a Comedy:
Julia Louis-Dreyfus, “Veep”
Tracee Ellis Ross, “black-ish”
Amy Schumer, “Inside Amy Schumer”

Comedy series:
“black-ish”
“Silicon Valley”
“Veep”

Drama series:
”Game of Thrones”

Outstanding Limited Series
“Fargo”
“The Night Manager”
“Roots”

TV Movie:
“All the Way”
“Confirmation”

Outstanding Supporting Actor In A Comedy Series
Louie Anderson, “Baskets”
Tony Hale, “Veep”
Matt Walsh, “Veep”

Outstanding Supporting Actor In A Drama Series
Peter Dinklage, “Game of Thrones”

Outstanding Supporting Actor In A Limited Series Or Movie
Jesse Plemons, “Fargo”
Bokeem Woodbine, “Fargo”
Hugh Laurie, “The Night Manager”

Outstanding Supporting Actress In A Comedy Series
Allison Janney, “Mom”
Kate McKinnon , “Saturday Night Live”
Anna Chlumsky, “Veep"

Outstanding Supporting Actress In A Drama Series
Maggie Smith, “Downton Abbey”
Lena Headey, “Game Of Thrones”
Emilia Clarke, “Game Of Thrones”
Maisie Williams, “Game Of Thrones”

Outstanding Supporting Actress In A Limited Series Or Movie
Jean Smart, “Fargo”

Dean Baker on Fed, Cassidy on Sanders

BERNIE SANDERS’S PHILOSOPHICAL VICTORY by John Cassidy

George Will and the Fed: Do Low Interest Rates Redistribute Upward by Dean Baker

Full employment, civil war on the left

Baker on full employment and the Democratic Platform

Vox weenies on Corbyn

Peter Frase on the center-left:

a moribund but still institutionally powerful neoliberal order that uses its accumulated power to compensate for its complete lack of compelling answers to contemporary political questions.

 Corey Robin on the Clinton forces:

The Clinton forces want nothing more than to make all of American politics—not just in this election but for the foreseeable future—into a battle between a racist, ethno-nationalist right and a multicultural, neoliberal center. Our job is to make politics into a struggle between a multicultural neoliberal center and a multicultural, multiracial socialist left.

The Youth are wise and right! You refused the call. Lady Mormont speaks harshly and truly.

The youth voted overwhelmingly for Bernie Sanders. They voted for Remain. After a pause in the discussion at the meeting of the victors over Ramsey Bolton, young Lady Mormont speaks up for Jon Snow:

"Your son was butchered at the Red Wedding, Lord Manderly, but you refused the call.

You swore allegiance to House Stark, Lord Glover, but in their hour of greatest need you refused the call.

And you, Lord Cerwyn, your father was skinned alive by Ramsey Bolton. Still, you refused the call.

But House Mormont remembers. The North remembers! We know no king but the King in the North whose name is Stark! I don't care if he's a bastard. Ned Stark's blood runs through his veins. He's my King from this day until his last day!"

"Winter is here." Game of Thrones Season 6 finale

Game of Thrones is probably my favorite TV show ever. The Ringer has a good discussion of the Season 6 finale.

WARNING

SPOILERS SPOILERS SPOILERS

Tyrion becomes Hand of the Queen as the Targaryen forces sail towards Westeros including Yara Greyjoy's fleet, the Unsullied, the Dothraki, and three dragons. Daenerys's advisers include Missandei, Grey Worm, Varys the Spider and Theon Greyjoy. Jorah Mormont is off looking for a cure to Stonescale (I would like to see him reunited with Lyanna Mormont). Daario Naharis and the Second Sons have stayed behind in Meereen.

Varys has brokered an alliance with the Dornish and Lady Olenna Tyrell (and also the Reach with Randall Tarly?).

Cersei is Queen and holder of the Iron Throne, along with Jaime, Bronn, Qyburn, and Gregor Clegane. The Sparrows and Faith Militant are gone. So is Kevan Lannister.

But the Freys are gone also, following the traitorous and disloyal Boltons into oblivion. Will Edmure Tully - now freed - and Riverrun rejoin the Starks? What about Sandor Clegane and the Brotherhood without Banners? Where is Melisandre the Red Priestess heading?

Jon Snow holds the North. Advisers include Sansa, Ser Davos, Tormund, Brienne, Podrick Payne, Lyanna Mormont and the other leaders of the Houses of the North. The Knights of the Vale and a dissatisfied Petyr Baelish. Bran Stark and Meera Reed head south past the Wall. (They know the Night King is heading south as Winter has arrived.) Samwell Tarly is studying at the Citadel. Dolorous Edd is leading the Nights Watch at Castle Black. Uncle Benjen/Coldhands is beyond the Wall.

Both Jon Snow and Sansa Stark know and like Tyrion Lannister, Hand to the Queen.

What will Euron Greyjoy do? Where will Arya head to next?

no inflation prediction in UK

pgl said in reply to Barkley Rosser...

And the risk of high inflation in the UK is zero. People are in a panic over this vote sort of like those poor people that heard a firecracker in the NYC's subway this week. I'm not saying there will not be self inflicted wounds that follow this vote but the vote itself does not mean that much. Stupid trade protection would be a bad thing but it is odd that a lot of people who are off in this panic attack lauded protectionism here. Go figure.

Friday, June 24, 2016 at 07:04 AM

Mason and Foroohar

How Should We Count Debt Owed to the Fed? by JW Mason

Why the Creative Accounting in the Microsoft-LinkedIn Deal Is So Disturbing by Rana Foroohar

Finding examples of how companies use financial engineering—instead of the realengineer—to bolster their balance sheets is like shooting fish in a barrel. The latest involves the biggest deal of the moment: Microsoft’s acquisition of LinkedIn. 

One of the reasons that LinkedIn many have wanted to be acquired, as Andrew Ross Sorkin explained in yesterday’s New York Times, is that it has been using a rather deceptive method of accounting that allows employee compensation paid in stock to be ignored as an expense. That makes for a bottom line that looks better than it really is. (This is especially true given that the amount of stock based-comp paid out by the company in the last two years was nearly equal to operating revenue, according to an analyst source.) 

LinkedIn isn’t alone in this sort of crafty accounting–most companies in the S&P now do it. (This piece is a great primer on how the funny math works.) But recently, Facebook started including stock comp in its reporting, and there’s a big push within corporate governance circles to get more companies to do that in order to get back to a more realistic version of earnings. After all, employee compensation, whether paid in cash or stock, is obviously an expense that should go on the balance sheet. 

It’s worth understanding just why, and how, stock-based compensation became such a huge deal to begin with. It marked a turning point toward short-term decision-making in corporate America. Key legislative changes that fueled the trend happened under Democratic president Bill Clinton, whose administration passed a 1993 provision on corporate pay. The measure limited corporate tax deductions for regular salaried income to $1 million but exempted “performance-related” pay above and beyond that—pay that was typically awarded in stock options. Joseph Stiglitz, a former head of Clinton’s Council of Economic Advisers, remembers this move as “one of the worst things that the Clinton administration did.” 

That’s because it created a tremendous incentive for companies to pay more compensation in options. This further fed the cycle of short-termism since executives would from then on be focused primarily on boosting stock prices, by any means necessary. As Stiglitz puts it, “It just opened up this huge span of bonus pay which was not for performance. I had written a lot about this before, that it was largely phony. I argued very strongly during the nineties that the whole stock option pay trend caused a lot of incentives for non-transparency, and that it was directly responsible for what I call creative accounting.” It allowed firms not just to deceive the market but also to avoid paying the taxes that they should have paid. 

Why does this matter so much now? Because it contributes to growing inequality and a lackluster economic recovery, by putting more and more tax-free compensation into the hands of the wealthy (who tend not to spend it after a certain point, which is a problem in an economy based mostly on consumer spending). What’s more, says Stiglitz, the performance exception didn’t really reward “performance” as much as any number of other factors, such as monetary policy that boosted stock prices. “If you’re really talking about performance, you should not get higher pay when your stock price goes up because the interest rate goes down,” he explains. “I mean, maybe Janet Yellen should get higher pay for that, but CEOs certainly shouldn’t.” He wrote in his searing memoir of the time, The Roaring Nineties, that “as the Clinton years came to a close, I wondered: What message had we in the end sent through the changes that had been brought about in our taxes?”

The Microsoft-LinkedIn deal brings all this to the fore once again. It’s a topic the next president should tackle head on, no matter the party.

After the Thrones

Another good episode of HBO's After the Thrones, where they brought in expert Mallory Rubin early to discuss the epic penultimate episode of Season 6.

Rubin - who always sports a cool T-shirt - mentioned Daenerys's quote I have in my banner area about breaking the wheel. They had an interesting discussion of all aspects of the episode focusing on things that stood out for me as well: like the fact Rickon didn't follow a serpentine rout (like in the original In-Laws movie) when running from Ramsey's arrows; that Sansa didn't alert Jon Snow that the calvary might by coming; that Davos found Shireen's toy stag and he eyed Melisandre forbodingly. I wish they had done this show throughout the series. So good.