Are governments’ efforts to reduce unemployment a cost-free solution?
Once an economy falls into an economic slump and the level of unemployment begins to rise most commentators are of the view that it…
The IMF chief economist sees a threat to world economies from a liquidity trap
In the Financial Times from November 2 2020, the IMF chief economist Gita Gopinath suggested that world economies at present are likely to be…
Can economic data help to clarify the state of the business cycle?
According to the popular way of thinking, various economic data can provide an analyst with the necessary information regarding the state of the economy….
The Fed and asset bubbles
According to the Financial Times from October 18th 2020, senior Federal Reserve officials are calling for tougher financial regulation to prevent the US central…
Can constant money growth rule prevent boom-bust cycles?
According to the Nobel Laureate in Economics, Milton Friedman, the key cause of the business cycles is the fluctuations in the growth rate of…
Why inflation is not about general increases in prices
For most commentators, inflation is about general increases in the prices of goods and services. From this, it is established that anything that contributes…
Is demand independent of production?
Following the ideas of John Maynard Keynes and Milton Friedman, many commentators associate economic growth with increases in the demand for goods and services….
Is diversification the heart of investment?
According to the Modern Portfolio Theory (MPT), financial asset prices always fully reflect all available and relevant information, and that any adjustment to…
Keynesian ideas can only make things worse
In the New York Times on September 8, 2020, Paul Krugman suggested that “The CARES Act, enacted in March, gave the unemployed an extra…
Why trade balance is not the essence of currency exchange rate determination
In July this year the US trade balance stood at a deficit of $63.6 billion against a deficit of $51 billion in July…