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On September 06 2014 06:42 bookwyrm wrote: Any quantitative method of investigating social reality is useful only to the extent that it can be used as a tool for establishing some qualitative analysis of your historical situation. If your slavish obedience to quantitative methods produces absurd results (like our society, and the things that come out of the mouths of economists) then you are doing it wrong. Could you give an example of an 'absurd result' that's being adhered to?
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On September 04 2014 08:58 bookwyrm wrote: Jonny you need to go think a little about malthus. I can't believe you actually think that exponential population growth implies exponential growth in 'productivity' (whatever it is that you mean by that term in the first place).
White dog, but he still thinks that capitalism is a system which can grow infinitely no matter the historical circumstances and that therefore all we have to do in the current situation is get the motor started again, by means of monetary policy. Right? Let's keep in mind that standards for historical consciousness in mainstream economics are very, very low. The definition of 'history' being basically 'the twentieth century'
I have contempt for anyone who thinks that monetary policy is a solution to our problems so ill admit ive never taken krugman seriously enough to investigate him very carefully. Should i? More to the point, can I learn anything about economic geography from him that I haven't already learned from David harvey? How do you know that ? there are two different problem : a long term problem, which is the fact that trending GDP growth is decreasing and that we might live in a society with no growth at all, for obvious ecological reasons.
And there is the current crisis, and that is completly different. Krugman is talking about the short term crisis problem, and not about the long term ecological dilema. Now about capitalism, it is a word that doesn't mean much to me, but it is true that private property will change in the near future, or we are doomed.
On September 04 2014 13:49 JonnyBNoHo wrote:Show nested quote +On September 04 2014 13:04 bookwyrm wrote:Answer the question! you claim that there are no long term cycles. You claim this is proved by economics, which you also claim doesn't study the long term because there is no data. Your reasoning is entirely circular... admit it! + Show Spoiler +also... i don't know how you could be paying attention to the world and feel that things are not going very very badly. It's just oblivious. I think it's hard to take YOU seriously because you think that crisis is some sort of a priori impossibility. Unless.... don't tell me... economics has proved that nothing bad can happen because nothing bad happened in the 20th century If you look at what long term data we have, economic periods prior to various economic revolutions (industrial revolutions, green revolutions, etc.) behaved very differently from the modern era. If you want me to show you some data examples of this I can, so ask. Because of those differences, in addition to data quality issues, we do not use the really old data for making modern predictions. It's not because of dogma, it's because the old data lost relevance. edit: Show nested quote +Its not dogma, using the best historical estimates available and doing relatively fudgy things like looking at the caloric intake of an average worker we roughly know that absent exogenous things like mass deaths of laborers economic growth per capita was relatively stable until the 18th century ^ exactly this. And it's largely because of that per capita stagnation that those 'long trends' took place. And it's because of the end of the per capita stagnation that the long trends have lost relevance. I don't understand your point at all. "Yesterday is different than today, see those data". But a lot of data actually show interesting relation between pre world war era (mostly XIXth century economic) and today (low inflation, low growth, high inequalities). It's just about the data you point out. Just saying things are different doesn't quite cut it : and how do you study today if you can't look back tomorrow ? Most anhistoric models have proven shakky at best and dangerous at worst.
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On September 06 2014 07:23 WhiteDog wrote:Show nested quote +On September 04 2014 08:58 bookwyrm wrote: Jonny you need to go think a little about malthus. I can't believe you actually think that exponential population growth implies exponential growth in 'productivity' (whatever it is that you mean by that term in the first place).
White dog, but he still thinks that capitalism is a system which can grow infinitely no matter the historical circumstances and that therefore all we have to do in the current situation is get the motor started again, by means of monetary policy. Right? Let's keep in mind that standards for historical consciousness in mainstream economics are very, very low. The definition of 'history' being basically 'the twentieth century'
I have contempt for anyone who thinks that monetary policy is a solution to our problems so ill admit ive never taken krugman seriously enough to investigate him very carefully. Should i? More to the point, can I learn anything about economic geography from him that I haven't already learned from David harvey? How do you know that ? there are two different problem : a long term problem, which is the fact that trending GDP growth is decreasing and that we might live in a society with no growth at all, for obvious ecological reasons. And there is the current crisis, and that is completly different. Krugman is talking about the short term crisis problem, and not about the long term ecological dilema. Now about capitalism, it is a word that doesn't mean much to me, but it is true that private property will change in the near future, or we are doomed. Show nested quote +On September 04 2014 13:49 JonnyBNoHo wrote:On September 04 2014 13:04 bookwyrm wrote:Answer the question! you claim that there are no long term cycles. You claim this is proved by economics, which you also claim doesn't study the long term because there is no data. Your reasoning is entirely circular... admit it! + Show Spoiler +also... i don't know how you could be paying attention to the world and feel that things are not going very very badly. It's just oblivious. I think it's hard to take YOU seriously because you think that crisis is some sort of a priori impossibility. Unless.... don't tell me... economics has proved that nothing bad can happen because nothing bad happened in the 20th century If you look at what long term data we have, economic periods prior to various economic revolutions (industrial revolutions, green revolutions, etc.) behaved very differently from the modern era. If you want me to show you some data examples of this I can, so ask. Because of those differences, in addition to data quality issues, we do not use the really old data for making modern predictions. It's not because of dogma, it's because the old data lost relevance. edit: Its not dogma, using the best historical estimates available and doing relatively fudgy things like looking at the caloric intake of an average worker we roughly know that absent exogenous things like mass deaths of laborers economic growth per capita was relatively stable until the 18th century ^ exactly this. And it's largely because of that per capita stagnation that those 'long trends' took place. And it's because of the end of the per capita stagnation that the long trends have lost relevance. I don't understand your point at all. "Yesterday is different than today, see those data". But a lot of data actually show interesting relation between pre world war era (mostly XIXth century economic) and today (low inflation, low growth, high inequalities). It's just about the data you point out. Just saying things are different doesn't quite cut it : and how do you study today if you can't look back tomorrow ? Most anhistoric models have proven shakky at best and dangerous at worst. You aren't reading what I wrote correctly. I'm not saying that you can't look at history. The issue is that economic activity 1000 years ago was so different that you can't necessarily draw modern conclusions from it.
Edit: you aren't even getting the context right. This isn't about history going back to pre-WW2 like in a Piketty data set, this is going back hundreds or even thousands of years.
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Greek officials brought up the issue of tax relief at talks in Paris this week with the lenders as part of the country's latest bailout review, but there has been no confirmation yet they have agreed to the package. Samaras said details of the tax cuts would be presented in the country's draft budget to be announced in October.
He also said a new taxation "roadmap" would be unveiled in the future, with the maximum income tax cut to 32 percent from 42 percent and the corporate tax rate reduced to 15 percent from 26 percent. A deeply unpopular property tax would also be cut, he said without providing any details.
The government on Saturday also confirmed that Greece will show growth in the third quarter, its first quarterly expansion since the start in 2008 of a crippling recession that has wiped out nearly a quarter of the country's economy. Reuters
That sounds like very drastic changes. Wonder what will happen as soon as Greece crashes again? This will certainly not be used politically... Or...
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On September 06 2014 08:00 JonnyBNoHo wrote:Show nested quote +On September 06 2014 07:23 WhiteDog wrote:On September 04 2014 08:58 bookwyrm wrote: Jonny you need to go think a little about malthus. I can't believe you actually think that exponential population growth implies exponential growth in 'productivity' (whatever it is that you mean by that term in the first place).
White dog, but he still thinks that capitalism is a system which can grow infinitely no matter the historical circumstances and that therefore all we have to do in the current situation is get the motor started again, by means of monetary policy. Right? Let's keep in mind that standards for historical consciousness in mainstream economics are very, very low. The definition of 'history' being basically 'the twentieth century'
I have contempt for anyone who thinks that monetary policy is a solution to our problems so ill admit ive never taken krugman seriously enough to investigate him very carefully. Should i? More to the point, can I learn anything about economic geography from him that I haven't already learned from David harvey? How do you know that ? there are two different problem : a long term problem, which is the fact that trending GDP growth is decreasing and that we might live in a society with no growth at all, for obvious ecological reasons. And there is the current crisis, and that is completly different. Krugman is talking about the short term crisis problem, and not about the long term ecological dilema. Now about capitalism, it is a word that doesn't mean much to me, but it is true that private property will change in the near future, or we are doomed. On September 04 2014 13:49 JonnyBNoHo wrote:On September 04 2014 13:04 bookwyrm wrote:Answer the question! you claim that there are no long term cycles. You claim this is proved by economics, which you also claim doesn't study the long term because there is no data. Your reasoning is entirely circular... admit it! + Show Spoiler +also... i don't know how you could be paying attention to the world and feel that things are not going very very badly. It's just oblivious. I think it's hard to take YOU seriously because you think that crisis is some sort of a priori impossibility. Unless.... don't tell me... economics has proved that nothing bad can happen because nothing bad happened in the 20th century If you look at what long term data we have, economic periods prior to various economic revolutions (industrial revolutions, green revolutions, etc.) behaved very differently from the modern era. If you want me to show you some data examples of this I can, so ask. Because of those differences, in addition to data quality issues, we do not use the really old data for making modern predictions. It's not because of dogma, it's because the old data lost relevance. edit: Its not dogma, using the best historical estimates available and doing relatively fudgy things like looking at the caloric intake of an average worker we roughly know that absent exogenous things like mass deaths of laborers economic growth per capita was relatively stable until the 18th century ^ exactly this. And it's largely because of that per capita stagnation that those 'long trends' took place. And it's because of the end of the per capita stagnation that the long trends have lost relevance. I don't understand your point at all. "Yesterday is different than today, see those data". But a lot of data actually show interesting relation between pre world war era (mostly XIXth century economic) and today (low inflation, low growth, high inequalities). It's just about the data you point out. Just saying things are different doesn't quite cut it : and how do you study today if you can't look back tomorrow ? Most anhistoric models have proven shakky at best and dangerous at worst. You aren't reading what I wrote correctly. I'm not saying that you can't look at history. The issue is that economic activity 1000 years ago was so different that you can't necessarily draw modern conclusions from it. Edit: you aren't even getting the context right. This isn't about history going back to pre-WW2 like in a Piketty data set, this is going back hundreds or even thousands of years. Modern theory on money dates back to Aristotle, most models are based on assumptions on human behavior that dates back to (at least) Bentham. There is a joke going around that new economy is just reading old economist again - and thus Adam Smith has been reread and discussed by a lot of people. The history, being a 1 000 years ago or during the XIXth century is relevant because it is still human producing, consuming and trading goods and services.
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On September 07 2014 02:07 WhiteDog wrote:Show nested quote +On September 06 2014 08:00 JonnyBNoHo wrote:On September 06 2014 07:23 WhiteDog wrote:On September 04 2014 08:58 bookwyrm wrote: Jonny you need to go think a little about malthus. I can't believe you actually think that exponential population growth implies exponential growth in 'productivity' (whatever it is that you mean by that term in the first place).
White dog, but he still thinks that capitalism is a system which can grow infinitely no matter the historical circumstances and that therefore all we have to do in the current situation is get the motor started again, by means of monetary policy. Right? Let's keep in mind that standards for historical consciousness in mainstream economics are very, very low. The definition of 'history' being basically 'the twentieth century'
I have contempt for anyone who thinks that monetary policy is a solution to our problems so ill admit ive never taken krugman seriously enough to investigate him very carefully. Should i? More to the point, can I learn anything about economic geography from him that I haven't already learned from David harvey? How do you know that ? there are two different problem : a long term problem, which is the fact that trending GDP growth is decreasing and that we might live in a society with no growth at all, for obvious ecological reasons. And there is the current crisis, and that is completly different. Krugman is talking about the short term crisis problem, and not about the long term ecological dilema. Now about capitalism, it is a word that doesn't mean much to me, but it is true that private property will change in the near future, or we are doomed. On September 04 2014 13:49 JonnyBNoHo wrote:On September 04 2014 13:04 bookwyrm wrote:Answer the question! you claim that there are no long term cycles. You claim this is proved by economics, which you also claim doesn't study the long term because there is no data. Your reasoning is entirely circular... admit it! + Show Spoiler +also... i don't know how you could be paying attention to the world and feel that things are not going very very badly. It's just oblivious. I think it's hard to take YOU seriously because you think that crisis is some sort of a priori impossibility. Unless.... don't tell me... economics has proved that nothing bad can happen because nothing bad happened in the 20th century If you look at what long term data we have, economic periods prior to various economic revolutions (industrial revolutions, green revolutions, etc.) behaved very differently from the modern era. If you want me to show you some data examples of this I can, so ask. Because of those differences, in addition to data quality issues, we do not use the really old data for making modern predictions. It's not because of dogma, it's because the old data lost relevance. edit: Its not dogma, using the best historical estimates available and doing relatively fudgy things like looking at the caloric intake of an average worker we roughly know that absent exogenous things like mass deaths of laborers economic growth per capita was relatively stable until the 18th century ^ exactly this. And it's largely because of that per capita stagnation that those 'long trends' took place. And it's because of the end of the per capita stagnation that the long trends have lost relevance. I don't understand your point at all. "Yesterday is different than today, see those data". But a lot of data actually show interesting relation between pre world war era (mostly XIXth century economic) and today (low inflation, low growth, high inequalities). It's just about the data you point out. Just saying things are different doesn't quite cut it : and how do you study today if you can't look back tomorrow ? Most anhistoric models have proven shakky at best and dangerous at worst. You aren't reading what I wrote correctly. I'm not saying that you can't look at history. The issue is that economic activity 1000 years ago was so different that you can't necessarily draw modern conclusions from it. Edit: you aren't even getting the context right. This isn't about history going back to pre-WW2 like in a Piketty data set, this is going back hundreds or even thousands of years. Modern theory on money dates back to Aristotle, most models are based on assumptions on human behavior that dates back to (at least) Bentham. There is a joke going around that new economy is just reading old economist again - and thus Adam Smith has been reread and discussed by a lot of people. The history, being a 1 000 years ago or during the XIXth century is relevant because it is still human producing, consuming and trading goods and services. I'm not referencing human behavior though. It's about the means of production, which have changed quite a bit. It's about changes in microeconomic activity more than macro.
Output per worker barely budged for thousands of years prior to the industrial revolution. If you don't think that's significant, you're living in fantasy.
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My only feeling towards all of this is hate... towards Angela Merkel. That fat cow spied on the Americans by "accident", but was unable to spy/investigate on the Greeks before lending them the money from ALL the EU countries? It is now known that Greece has lied about their finances in order to get money from the EU. This all should make it clear now that socialism is not the way to go! If you're too lazy to work... Sleep on the streets. If your country leaders are doing a terrible job, it's also your fault for not being informed about politics and still go vote or worse, not voting at all when you are informed properly. In Belgium, we also have a very social system and things have been getting worse over the last 30 years: less people working and way more taxes for those who do work... I'm quite sure that's not how things are supposed to be.
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On September 06 2014 23:45 radiatoren wrote:Show nested quote +Greek officials brought up the issue of tax relief at talks in Paris this week with the lenders as part of the country's latest bailout review, but there has been no confirmation yet they have agreed to the package. Samaras said details of the tax cuts would be presented in the country's draft budget to be announced in October.
He also said a new taxation "roadmap" would be unveiled in the future, with the maximum income tax cut to 32 percent from 42 percent and the corporate tax rate reduced to 15 percent from 26 percent. A deeply unpopular property tax would also be cut, he said without providing any details.
The government on Saturday also confirmed that Greece will show growth in the third quarter, its first quarterly expansion since the start in 2008 of a crippling recession that has wiped out nearly a quarter of the country's economy. ReutersThat sounds like very drastic changes. Wonder what will happen as soon as Greece crashes again? This will certainly not be used politically... Or...
Sounds like a good change. Wasn't one of the running "issues" with Greece that tax avoidance is a national pastime? Lower the overall "rate", clean up (hopefully) a lot of the compliance issues, and tax "cuts" end up normally looking fairly flat for revenue.
It's not a cure-all, but a lot of Europe would be better off if they had learned this a long time ago. Only downside is that tax cuts aren't a way to keep your Public Sector from constantly growing by 2-4% per year. That's a separate problem.
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On September 08 2014 14:30 Tabashi wrote: My only feeling towards all of this is hate... towards Angela Merkel. That fat cow spied on the Americans by "accident", but was unable to spy/investigate on the Greeks before lending them the money from ALL the EU countries? It is now known that Greece has lied about their finances in order to get money from the EU. This all should make it clear now that socialism is not the way to go! If you're too lazy to work... Sleep on the streets. If your country leaders are doing a terrible job, it's also your fault for not being informed about politics and still go vote or worse, not voting at all when you are informed properly. In Belgium, we also have a very social system and things have been getting worse over the last 30 years: less people working and way more taxes for those who do work... I'm quite sure that's not how things are supposed to be. This has nothing to do with socialism, and Greeks are the hardest workers in europe. What is happening is the eurozone has some grave economical problem, from a demand standpoint. It also has a way too high labor cost due to an over evaluated euro. In order to employ lower productive workers in southern europe, you would have to lower minimum wage to an absurd point - below subsistance in many countries - and most countries refused that and created solidarity systems in order to assure a certain level of subsistance to the weakest. Add to that the fact hat everybody is afraid of protectionism because we're ruled by tards. As time goes by and as nobody is brave enough to reform this absurd euro, the situation has deteriorated itself as Germany, the lone horse, profit from the situation.
On September 08 2014 04:09 JonnyBNoHo wrote:Show nested quote +On September 07 2014 02:07 WhiteDog wrote:On September 06 2014 08:00 JonnyBNoHo wrote:On September 06 2014 07:23 WhiteDog wrote:On September 04 2014 08:58 bookwyrm wrote: Jonny you need to go think a little about malthus. I can't believe you actually think that exponential population growth implies exponential growth in 'productivity' (whatever it is that you mean by that term in the first place).
White dog, but he still thinks that capitalism is a system which can grow infinitely no matter the historical circumstances and that therefore all we have to do in the current situation is get the motor started again, by means of monetary policy. Right? Let's keep in mind that standards for historical consciousness in mainstream economics are very, very low. The definition of 'history' being basically 'the twentieth century'
I have contempt for anyone who thinks that monetary policy is a solution to our problems so ill admit ive never taken krugman seriously enough to investigate him very carefully. Should i? More to the point, can I learn anything about economic geography from him that I haven't already learned from David harvey? How do you know that ? there are two different problem : a long term problem, which is the fact that trending GDP growth is decreasing and that we might live in a society with no growth at all, for obvious ecological reasons. And there is the current crisis, and that is completly different. Krugman is talking about the short term crisis problem, and not about the long term ecological dilema. Now about capitalism, it is a word that doesn't mean much to me, but it is true that private property will change in the near future, or we are doomed. On September 04 2014 13:49 JonnyBNoHo wrote:On September 04 2014 13:04 bookwyrm wrote:Answer the question! you claim that there are no long term cycles. You claim this is proved by economics, which you also claim doesn't study the long term because there is no data. Your reasoning is entirely circular... admit it! + Show Spoiler +also... i don't know how you could be paying attention to the world and feel that things are not going very very badly. It's just oblivious. I think it's hard to take YOU seriously because you think that crisis is some sort of a priori impossibility. Unless.... don't tell me... economics has proved that nothing bad can happen because nothing bad happened in the 20th century If you look at what long term data we have, economic periods prior to various economic revolutions (industrial revolutions, green revolutions, etc.) behaved very differently from the modern era. If you want me to show you some data examples of this I can, so ask. Because of those differences, in addition to data quality issues, we do not use the really old data for making modern predictions. It's not because of dogma, it's because the old data lost relevance. edit: Its not dogma, using the best historical estimates available and doing relatively fudgy things like looking at the caloric intake of an average worker we roughly know that absent exogenous things like mass deaths of laborers economic growth per capita was relatively stable until the 18th century ^ exactly this. And it's largely because of that per capita stagnation that those 'long trends' took place. And it's because of the end of the per capita stagnation that the long trends have lost relevance. I don't understand your point at all. "Yesterday is different than today, see those data". But a lot of data actually show interesting relation between pre world war era (mostly XIXth century economic) and today (low inflation, low growth, high inequalities). It's just about the data you point out. Just saying things are different doesn't quite cut it : and how do you study today if you can't look back tomorrow ? Most anhistoric models have proven shakky at best and dangerous at worst. You aren't reading what I wrote correctly. I'm not saying that you can't look at history. The issue is that economic activity 1000 years ago was so different that you can't necessarily draw modern conclusions from it. Edit: you aren't even getting the context right. This isn't about history going back to pre-WW2 like in a Piketty data set, this is going back hundreds or even thousands of years. Modern theory on money dates back to Aristotle, most models are based on assumptions on human behavior that dates back to (at least) Bentham. There is a joke going around that new economy is just reading old economist again - and thus Adam Smith has been reread and discussed by a lot of people. The history, being a 1 000 years ago or during the XIXth century is relevant because it is still human producing, consuming and trading goods and services. I'm not referencing human behavior though. It's about the means of production, which have changed quite a bit. It's about changes in microeconomic activity more than macro. Output per worker barely budged for thousands of years prior to the industrial revolution. If you don't think that's significant, you're living in fantasy. You're talking about data we don't have and comparaison we never made. Do you think there are any historical data prior to the industrial revolution ? At best we have some kind of data on revenu after the french revolution and that's it. Theory of economic cycle is not based on data prior to the industrial revolution, also not all cycle are directly related to production (juglar cycle are related to investment). Does that completly discard history as a relevant topic for modern economists ? It's obvious that the answer is no. Production prior to the industrial revolution is actually very important to understand how a market behave without the authority of the state ?
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Show nested quote +On September 08 2014 04:09 JonnyBNoHo wrote:On September 07 2014 02:07 WhiteDog wrote:On September 06 2014 08:00 JonnyBNoHo wrote:On September 06 2014 07:23 WhiteDog wrote:On September 04 2014 08:58 bookwyrm wrote: Jonny you need to go think a little about malthus. I can't believe you actually think that exponential population growth implies exponential growth in 'productivity' (whatever it is that you mean by that term in the first place).
White dog, but he still thinks that capitalism is a system which can grow infinitely no matter the historical circumstances and that therefore all we have to do in the current situation is get the motor started again, by means of monetary policy. Right? Let's keep in mind that standards for historical consciousness in mainstream economics are very, very low. The definition of 'history' being basically 'the twentieth century'
I have contempt for anyone who thinks that monetary policy is a solution to our problems so ill admit ive never taken krugman seriously enough to investigate him very carefully. Should i? More to the point, can I learn anything about economic geography from him that I haven't already learned from David harvey? How do you know that ? there are two different problem : a long term problem, which is the fact that trending GDP growth is decreasing and that we might live in a society with no growth at all, for obvious ecological reasons. And there is the current crisis, and that is completly different. Krugman is talking about the short term crisis problem, and not about the long term ecological dilema. Now about capitalism, it is a word that doesn't mean much to me, but it is true that private property will change in the near future, or we are doomed. On September 04 2014 13:49 JonnyBNoHo wrote:On September 04 2014 13:04 bookwyrm wrote:Answer the question! you claim that there are no long term cycles. You claim this is proved by economics, which you also claim doesn't study the long term because there is no data. Your reasoning is entirely circular... admit it! + Show Spoiler +also... i don't know how you could be paying attention to the world and feel that things are not going very very badly. It's just oblivious. I think it's hard to take YOU seriously because you think that crisis is some sort of a priori impossibility. Unless.... don't tell me... economics has proved that nothing bad can happen because nothing bad happened in the 20th century If you look at what long term data we have, economic periods prior to various economic revolutions (industrial revolutions, green revolutions, etc.) behaved very differently from the modern era. If you want me to show you some data examples of this I can, so ask. Because of those differences, in addition to data quality issues, we do not use the really old data for making modern predictions. It's not because of dogma, it's because the old data lost relevance. edit: Its not dogma, using the best historical estimates available and doing relatively fudgy things like looking at the caloric intake of an average worker we roughly know that absent exogenous things like mass deaths of laborers economic growth per capita was relatively stable until the 18th century ^ exactly this. And it's largely because of that per capita stagnation that those 'long trends' took place. And it's because of the end of the per capita stagnation that the long trends have lost relevance. I don't understand your point at all. "Yesterday is different than today, see those data". But a lot of data actually show interesting relation between pre world war era (mostly XIXth century economic) and today (low inflation, low growth, high inequalities). It's just about the data you point out. Just saying things are different doesn't quite cut it : and how do you study today if you can't look back tomorrow ? Most anhistoric models have proven shakky at best and dangerous at worst. You aren't reading what I wrote correctly. I'm not saying that you can't look at history. The issue is that economic activity 1000 years ago was so different that you can't necessarily draw modern conclusions from it. Edit: you aren't even getting the context right. This isn't about history going back to pre-WW2 like in a Piketty data set, this is going back hundreds or even thousands of years. Modern theory on money dates back to Aristotle, most models are based on assumptions on human behavior that dates back to (at least) Bentham. There is a joke going around that new economy is just reading old economist again - and thus Adam Smith has been reread and discussed by a lot of people. The history, being a 1 000 years ago or during the XIXth century is relevant because it is still human producing, consuming and trading goods and services. I'm not referencing human behavior though. It's about the means of production, which have changed quite a bit. It's about changes in microeconomic activity more than macro. Output per worker barely budged for thousands of years prior to the industrial revolution. If you don't think that's significant, you're living in fantasy. You're talking about data we don't have and comparaison we never made. Do you think there are any historical data prior to the industrial revolution ? At best we have some kind of data on revenu after the french revolution and that's it. Theory of economic cycle is not based on data prior to the industrial revolution, also not all cycle are directly related to production (juglar cycle are related to investment). Does that completly discard history as a relevant topic for modern economists ? It's obvious that the answer is no. Production prior to the industrial revolution is actually very important to understand how a market behave without the authority of the state ? There's some data through which you can infer quite a bit. And yeah, I'm arguing against the long wave theory that Bookwyrm was promoting, so I do think output per worker is relevant.
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REUTERS - The European Union formally adopted the new package of sanctions against Russia over its involvement in Ukraine on Monday evening, EU President Herman Van Rompuy said.
Van Rompuy added that the sanctions will enter into force in the next few days.
Earlier, it was reported the EU governments delayed signing off on the sanctions, because some governments wanted to discuss how to suspend the sanctions if a Ukraine cease-fire holds.
EU envoys were due to meet again at 6:00 P.M. (4:00 P.M.) in Brussels to decide whether the sanctions - agreed in principle on Friday - should be first implemented and then suspended if the cease-fire holds or whether they should not be implemented at all at this stage, they said.
While the discussions appear largely procedural, many countries opposed to further punishment of Moscow for sending troops into Ukraine see it as an opportunity to block the package and avoid retaliatory measures from Russia, diplomats said.
The EU sanctions would affect Russia's top oil producers and pipeline operators Rosneft, Transneft and Gazprom Neft, which would be put on the list of Russian state-owned firms that will not be allowed to raise capital or borrow on European markets, an EU diplomat said.
Source
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Martin Wolf on the continued eurozone crisis:
Europe has to do whatever it takes The new European Commission needs to take a stand for common sense and growth In the second quarter of this year, real domestic demand in the eurozone was 5 per cent lower than in the first quarter of 2008. The eurozone’s unemployment rate has risen by just under 5 percentage points since 2008. In the year to July 2014, consumer price inflation in the eurozone was 0.4 per cent. From these telling facts one can conclude three simple things: the eurozone is in a depression; lack of demand has played a crucial role; and the European Central Bank has failed to deliver on its own price-stability target. This is not just sad. It is dangerous. It is folly to assume continued stability if economic performance does not improve. + Show Spoiler +A necessary, though not sufficient, condition for grappling with these challenges is understanding them. In this regard, Mario Draghi, ECB president, and the one senior eurozone policy maker who shows a grasp of the issues, made a vital contribution at this year’s Jackson Hole symposium for central bankers. Two points need stressing. First, he stated that “we need action on both sides of the economy: aggregate demand policies have to be accompanied by national structural policies”. Second, he made a new promise: he remarked, off text, that the ECB “will use all the available instruments needed to ensure price stability in the medium term.” Choirs of angels must have sung over the statement that the eurozone has a problem with demand. Hitherto, eurozone orthodoxy has treated this truth as unmentionable. No less important might be the promise of action. It reminds us of the celebrated “whatever it takes”, delivered by Mr Draghi in London in July 2012. This led to the announcement of the ECB’s outright monetary transactions programme, which defeated pervasive panic without firing a shot. Astonishingly, yields on Italian and Spanish 10-year debt have fallen from 6.3 per cent and 7.0 per cent, respectively, at the beginning of August 2012, to a mere 2.3 and 2.1 per cent early this month. That is below the yield on UK gilts. At Jackson Hole Mr Draghi stated he was “confident” that the package of measures announced in June and now being implemented would deliver the “intended boost to demand”. It is reasonable to be sceptical. In the six years to the second quarter of 2014, nominal demand rose a mere 2 per cent. Credit channels remain impaired. Fiscal policy also continues to tighten, even though interest rates are at the zero bound: the OECD has forecast that the cyclically adjusted fiscal deficit of the eurozone would shrink from a mere 1.4 per cent in 2013 to an even more austere 0.9 per cent in 2014. Huge divergences in competitiveness remain. These are more difficult to rectify when inflation is so low. This is forcing vulnerable countries into deflation, which raises the real level of their debt. Meanwhile, creditworthy core countries are black holes for demand: this year Germany’s current account surplus might be as big as 8 per cent of gross domestic product. Last week the ECB promised to purchase a broad portfolio of “simple and transparent asset-backed securities”. This, it hopes, will improve credit intermediation inside the eurozone. It also hopes that, through this and other programmes it has announced, it will be able to expand its balance sheet back to where it was two years ago. This makes sense. It was an error to let it shrink by about 10 per cent of eurozone GDP when other central banks, with considerably smaller problems than the eurozone’s to deal with, were avoiding premature withdrawal of such support (see chart). Moreover, the range of measures taken reinforce the ECB’s forward guidance. It has locked itself into ultra-accommodative monetary policies for years, as it should. Yet, despite all these actions, the interlocking problems of the eurozone are unlikely to be resolved soon. Indeed even the ECB forecasts no more than feeble growth ahead. So, should the ECB do more? And what, above all, do other policy makers need to do in support? The immediate question is whether the ECB should begin a programme of outright quantitative easing by buying government bonds, presumably in proportion to shares of member countries in eurozone GDP. In a blog post in July, senior officials of the International Monetary Fund argued that such QE would be effective. It would, they argued, reinforce the credibility of the ECB target and have important effects on the prices of financial assets, including bonds and equities, and probably on exchange rates, too. I agree that it should be tried. The current situation is too dire for policy makers to eschew such a valuable instrument. But declines in bond yields have already been so dramatic that QE’s effects would no longer be as startling as they would have been two years ago. Furthermore, it is clear that the ECB would be taking on credit risk. It would be charged with monetary financing of governments. I believe it should go ahead. But the row between northern and southern Europe would surely be deafening. What else is left? One possibility, suggested in Mr Draghi’s speech, is active use of fiscal policy. Ideally, there should be a mixture of higher public investments and lower taxes, particularly in countries with room for fiscal manoeuvre. The overall fiscal stance is too tight, with a deficit forecast by the OECD at just 2.5 per cent of GDP in a deep slump. In return, as Mr Draghi demands, countries need to embrace serious reforms, to raise supply potential – and, by stimulating investment, demand as well. A determination to use all instruments possible to raise demand, enhance supply potential and improve competitiveness is where the eurozone must try to go. The new European Commission needs to take a stand for common sense and growth, instead of insisting on misery yet again. This is not just a matter of economics. The capacity of the peoples of member states to tolerate high unemployment and deep slumps has been impressive. But it cannot be unlimited. If that is what the powers that be continue to advocate, the result will probably be a populist reaction. This, sadly, is what we are seeing in Scotland. It is what we are soon likely to see elsewhere. Who is sure Marine Le Pen, leader of the far right National Front party, will not be the next president of France? Who would follow Matteo Renzi, Italy’s prime minister, if he failed? Yes, these member states need to act. But they surely need support. Mr Draghi has shown the way. The eurozone must follow. Charts: + Show Spoiler + Link
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Eurozone has to take a stand for common sense and growth. Everyone knows that capitalism requires it.
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On September 10 2014 08:50 IgnE wrote: Eurozone has to take a stand for common sense and growth. Everyone knows that capitalism requires it. Just saying something doesn't make it true sweetie
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You seem more guilty of that than me though.
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Actually capitalism is perfectly okay with the current situation, as the remuneration of capital is higher in lower inflation scenario, not to mention the high unemployment that perfect push wage lower than they should be. There is no inherent mechanism in a capitalist system that consider full employment and balance of trade as relevant goals, those are political goals.
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It is interesting to see a french socialist economy commissioner. I expect he is on the austerity team since he was chosen by Hollande? Having a british tory commissioner for finance seems even more questionable. Not to add that the danish commissioner as a competition commissioner is quite a risky choice given her previous very liberal almost laissez faire on many regulation issues. And don't get me started on a thrown out conservative german digital agenda commissioner without any experience in that field and 61 years of age...
This seems to be a horror cabinet. Let us hope the tiered system works out cause those choices for the technical commissioners are controversial. This can end in internal struggles or very questionable legislation very fast. Not exactly what the doctor ordered in terms of dealing with the economic issues.
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On September 11 2014 06:03 WhiteDog wrote: Actually capitalism is perfectly okay with the current situation, as the remuneration of capital is higher in lower inflation scenario, not to mention the high unemployment that perfect push wage lower than they should be. There is no inherent mechanism in a capitalist system that consider full employment and balance of trade as relevant goals, those are political goals.
Is capitalism perfectly okay with negative growth?
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On September 11 2014 09:00 IgnE wrote:Show nested quote +On September 11 2014 06:03 WhiteDog wrote: Actually capitalism is perfectly okay with the current situation, as the remuneration of capital is higher in lower inflation scenario, not to mention the high unemployment that perfect push wage lower than they should be. There is no inherent mechanism in a capitalist system that consider full employment and balance of trade as relevant goals, those are political goals. Is capitalism perfectly okay with negative growth? What makes you think that it wouldn't be OK?
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Capitalism only cares about short term gains. Who cares about suppressing wages to the point where no one can afford anything if it means next quarter will have higher profits? The downside is that in the long run, you won't have any customers if people can't even afford to feed themselves, let alone buy your products.
Negative growth is fine as long as the sector I'm investing in continues to grow.
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