Economics Exposed!
Editor's Comments in Red

Return to Current Political Economy Issues   Updated 4/20/18      Please link to, use to educate and share.   
 

1. Fine Tuning Monetary Policy Usually Doesn't Work

4. Seven Deadly Innocent Economic Policy Frauds

2.  Misuse of Inflation Data is Allowed

3. Was the Great Recession Really Great?

5. A New Cycle Changes Everything

6. Why Poverty is Controversial?   

7. Humanity Getting Better?

   8. Did Lowest Income Quintile Improve 1989 to 2015? 
   

9. Why Do People Continue To Believe Stupid Economic Ideas?
  40 min video 4/17 Mark Blyth

               
10. Economics Rules: The Rights and Wrongs of the Dismal Science LSE 11/09/15

1. Fine Tuning Monetary Policy Usually Doesn't Work

" ...we do not... have a theory of inflation dynamics that works sufficiently well to be of use for the business of real-time monetary policy-making."
Daniel Tarullol
from Monetary Policy Without a Working Theory of Inflation
Greenspan almost fooled all of the people all of the time! 
 

When Economists ignore the Human Factor and  We All Pay the Price

"...economists too often assumed that market actors not only behave rationally but do so according to the same mental models deployed by economists. Modern macroeconomics also  minimized affects of the financial system."

Mathematical Economists adjuste by accepting Behavioral Economics
which made economic models Even More Useless.

Liars, extreme liars and statisticians applies to economists and politicians.

2. Misuse of Inflation Data Allowed
   A. Three Inflation Measures Support Many Prejudices

     1. CPI Adjusted Index-Chart is Red
       a) Adjusts for seasonable differences
       b) Under estimates income change source
       c) Used by people wanting quickly updated data
       d)
Used to grow support for government programs
    2. CPI-U-RS Adjusted-Chart is Blue   
      a) Measures urban purchases which is more realistic
      b) It does not incorporate all possible data on past inflation. 
      c) For example, no attempt made to reflect any new information
        on trends in the safety or comfort of air travel for which there

        is no corresponding methodological change in the CPI-U. bls.gov
    3. PCE A Index-Chart is Green reflects "consumer substitution" is difficult
      to implement in real time.
      a) Measures buying of economic shoppers 
      b. When oranges are really expensive substitute bananas or grapefruit.
        1. BLS examples
        2.
PI-PCE-Comparison4
        3. CPI A is like always shopping at the local convenience stores
        4. PCE is like shopping at Wal-Mart, local sales and Internet for the now
          popular i-phone.
    4.
Problems With Economic Measurements Over Time 5 min video
 

B. Data supports almost all economic philosophies.

 

Was the Great Recession Really Great?

 

 

Read the Book:
by W. Moster


W. Moster lecture 
62 min.

Video Interview
with M. Moster

The Euro: past, present and future. The Crossroads Workshop 42 min. video

Moster's hypothesis
is dependent upon U.S.

Exorbitant Dollar Privilege.

Interesting Quotes

"If you insure [banks] you had better regulate [banks] otherwise banks have no skin in the game."

Concerning pro cyclical policies "Its fine on the way up"

 

A New Cycle Changes Everything?
Last 65 Year Cycle Helped Many, Hurt Many

 


Why is Poverty Controversial?
Liars, Dame Liars and Economists
 


Poverty Down Only 4.5% Points Over Fifty Years


Poverty Down 14.2% Points Over Fifty Years 

See War on Poverty, Was it Lost? NYT Legacies of the War on Poverty by Martha J. Bailey (Editor), Sheldon Danziger (Editor)

This chart "...provides a first approximation of how correcting the 2013 poverty rate for noncash food and housing benefits, refundable tax credits, and not using the upward [inflation] bias of the CPI-U would change the 2013 poverty rate. This adjusted poverty rate falls from 14.5 to 4.8 percent, making the 2013 rate roughly a quarter of the 1964 rate (19.0 percent). If we were to lower the poverty threshold for cohabiting couples to match that for married couples the 2013 poverty rate would have fallen even more." Examples of noncash benefits include food stamps SNAP), discounted school lunches, subsidized rent, Medicaid, and Medicare. See Source Editors Comments are in red. Editor' Note:
Economists stay employed by giving two answers, 16% for liberals and 4.8% for conservatives.
For more concerning poverty visit  Current U.S. Political Economy Controversies

 

 

Did Lowest Income Quintile Improve 1989 to 2015? 
Q1 Closed 47% of the Absolute Gap With Q2 in One Generation.
Using a relative measure the bottom can't ever catch up.
Closing the Relative Gap Would Mean Equalizing Income 
which Russia tried from 1919 to 1980   Return to Top

Income Quintiles Inflation-Adjusted Expenditures

Income Group

Year

Quintile Gain
(2015 - 1989)

Portion of 1989 Gap Closed

1989

P2 - P1 Gap

2015

Q1 Bottom 20 Percent

$20,296

29,561-20,296 =$9,265

$24,622

24,622 - 20,296 =$4,326

4,326-/9,264 = .4669
 = 47%

Q2 Second 20 Percent

$29,561

 

$35,529

 

51%

Q3 Middle 20 Percent

$41,223

 

$46,363

 

31%

Q4 Fourth 20 Percent

$57,612

 

$64,381

 

21%

Q5 Top 20 Percent

$89,443

 

$111,633

 

 

How much of the absolute income of the poor be sacrificed 
to lower the relative gap between the rich and th poor?
Russian Communism tried too much and total production tanked.

 

 
 

Humanity Getting Better 1:29 video

See Economic Future of Our Children and Are Children & Young People Protected?
 

Please      Comments to antonw@ix.netcom.com

 

Is_Time_to_Take_More_from_the_Top_1/10_of_1%___