It seems pretty obvious that when the economy is weak individual’s earnings go down, and unemployment goes up, consequently tax revenues go down. After all, if people aren’t making any money they can’t give it to the government. So, it seems logical to ask about falling tax revenues and rising deficits. In today’s article, Ryan McMaken looks at the current situation.
If the Economy Is So Great, Why Are Tax Revenues So Weak? Read More »
Mark Thornton and Ryan McMaken discuss the current yield curve inversion. The U.S. Treasury funds deficit spending by issuing debt instruments with a range of maturities. Treasury Bills have maturities from one month to one year. Treasury Notes have maturities from two to ten years. And long-term debt is issued as Treasury Bonds with 20- and 30-year maturities. The yield curve is created by comparing interest rates between ten-year debt to 3-month debt. Logically, long-term debt should require a higher interest rate than short-term debt simply because a lot can happen in ten years so there is more uncertainty, i.e., risk.
Deepest Yield Curve Inversion Since 1981 Read More »
Modern money, having now become a key tool of government economic policy and a source of massive tax revenues, has strayed far from its original purpose. This is doubly regrettable, as the better money functions at an individual level in satisfying demand for quality, the better it is for economic prosperity and freedom.
This book presents how modern money works both in the domestic economy and globally, outlining the essence of what makes good money. How does modern money differ from this ideal?
A Guide to Good Money Read More »
When Congresswoman Marjorie Taylor Greene called (again) for “national divorce” this week, a common retort among her detractors on Twitter was to claim that so-called red states are heavily dependent on so-called blue states to pay for pretty much everything. Reporter Molly Knight claimed, for example, that “Red states get their money for roads and cops and schools from blue states. You cut off that gravy train and you e [sic] got a third world country.”
Do “Red States” Ride the “Blue State” Gravy Train? Read More »
In the following article Ryan McMaken talks about “States,” but he uses the term in the classical sense meaning “country,” not in the way we in the United States tend to think of the term. He tells us that the number of states has almost tripled since 1945. This is due to countries splitting into smaller units. A classic example is the Soviet Union breaking up into its smaller components. Other examples are the breakup of Yugoslavia, North and South Korea, and North and South Vietnam. There is even occasional talk of Quebec splitting from the rest of Canada due to language and cultural differences. So there is definitely a trend in place toward smaller countries. Today Ryan is looking at the political consequences of smaller, more localized units of government.
Are Countries Getting Smaller? Read More »
The average square footage in new single-family houses has been declining since 2015. House sizes tend to fall just during recessionary periods. It happened from 2008 to 2009, from 2001 to 2002, and from 1990 to 1991. But even with strong economic-growth numbers well into 2019, it looks like demand for houses of historically large size may have finally peaked even before the 2020 recession and our current economic malaise. (Square footage in new multifamily construction has also increased.)
Housing Is Getting Less Affordable Read More »
We’ve been saying for a while that the FED’s been “behind the curve”. First they said inflation was “transitory” and nothing to worry about (while we said to start worrying). Then they said they would start tightening “later”. And finally it begins, but it should have begun months ago, the inflation “genie” is out of the bottle and the FED is going to have a difficult time getting it back in. In today’s article, Ryan McMaken tells us how the FED’s actions are “too little too late”
The Fed’s New “Tightening” Plan Is Too Little, Too Late Read More »
