tag:blogger.com,1999:blog-6616959642391988608.post5941804380295228168..comments2024-03-28T00:18:25.641-07:00Comments on Calafia Beach Pundit: Charts we never thought we'd seeScott Grannishttp://www.blogger.com/profile/14028519647946868684noreply@blogger.comBlogger15125tag:blogger.com,1999:blog-6616959642391988608.post-59815659690492479322018-04-03T15:26:37.448-07:002018-04-03T15:26:37.448-07:00Mark: to answer your question, no. Producing safe ...Mark: to answer your question, no. Producing safe assets like T-bills requires no labor. Nothing is produced save pieces of paper with promises attached to them. <br /><br />When a person supplies his labor, or a business supplies its products to the economy, they have done something of value. When they realize that value (by selling or working), they own genuine resources as a result, and those Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-22817488734514222802018-04-03T14:54:47.791-07:002018-04-03T14:54:47.791-07:00Amatuer question? If supply creates demand in the...Amatuer question? If supply creates demand in the economy, would that not by default imply an increased supply of safe assets creates a demand for safe assets?Markhttps://www.blogger.com/profile/04674528266334785306noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-89305275737203023302018-04-03T00:47:46.950-07:002018-04-03T00:47:46.950-07:00One problem with explaining the declining producti...One problem with explaining the declining productivity by saying "higher taxes and regulations," is that the decline has occurred globally.<br /><br /> We have had tight central banks and loose labor markets, until very recently. And the metrics we use today may overstate labor market tightness.<br /><br /> The good news is I think we will see better productivity going forward, thanks Benjamin Colehttps://www.blogger.com/profile/14001038338873263877noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-60829347079901041072018-04-02T15:08:00.886-07:002018-04-02T15:08:00.886-07:00Cameron: As I noted in my Jan 11th post (http://sc...Cameron: As I noted in my Jan 11th post (http://scottgrannis.blogspot.com/2018/01/worrying-about-rising-confidence.html), rising confidence is causing a decline in the demand for money (which is equivalent to a rise in money velocity). M2 growth has slowed dramatically (now only 1-2%), while nominal GDP growth is significantly faster (4-5%) than the growth of money. That means money velocity is Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-24347249224890955792018-04-02T14:27:22.058-07:002018-04-02T14:27:22.058-07:00Scott - money supply is finally growing slower tha...Scott - money supply is finally growing slower than real gdp which is a new phenomena - money velocity is still in a downtrend - the market is finally selling off - the market is usually a good leading indicator but obviously makes lots of mistakes - perhaps we have reached the point of the cycle where the real economy might finally begin to outperform the market as opposite to the opposite the ckhajavihttps://www.blogger.com/profile/17420262894265360495noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-75711157414582300012018-04-02T14:18:15.863-07:002018-04-02T14:18:15.863-07:00Marcus, another way to look at it is that we had a...Marcus, another way to look at it is that we had a massive increase in the money stock and an implosion in velocity. Those two effects roughly balanced out to produce small GDP growth as well as a small growth in the price level. (The huge demand for safe assets is the exact reason velocity declined so spectacularly despite all the lack of incentives that Scott references.). Grechsterhttps://www.blogger.com/profile/08898953158865778397noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-22230994870242286812018-04-02T13:59:18.440-07:002018-04-02T13:59:18.440-07:00Re the "insatiable demand" for safe asse...Re the "insatiable demand" for safe assets. I think there is plenty of evidence that demand for safe assets (e.g., money, savings deposits, T-bills) was extraordinary, viz: the significant growth of bank savings deposits, despite the fact that they offered little or nothing in the way of interest, the extremely low interest rates on short-term deposits in general, the fact that the Fed Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-67317842481589064912018-04-02T13:56:56.221-07:002018-04-02T13:56:56.221-07:00Price is evidence, although perhaps not dispositiv...Price is evidence, although perhaps not dispositive. Richhttps://www.blogger.com/profile/12549238790081597160noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-43545520012225404172018-04-02T12:28:20.030-07:002018-04-02T12:28:20.030-07:00you reason, as always, post ergo propter hoc. you ...you reason, as always, post ergo propter hoc. you have no evidence of this "insatiable" demand, other than the issuance of the reserves, which is circular reasoning too. and the demand for equity assets? is this proof the other way? marcusbalbushttps://www.blogger.com/profile/13596266889368486043noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-82017828971772789742018-04-02T12:06:00.276-07:002018-04-02T12:06:00.276-07:00What I hope our President learns is that tariffs m...What I hope our President learns is that tariffs manipulate markets in a negative way.Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-48213490897761782182018-04-02T10:16:25.050-07:002018-04-02T10:16:25.050-07:00I think the evidence points to far greater red tap...I think the evidence points to far greater red tape, as measured by administrative costs, associated with private health insurance as compared to Medicare.<br /><br />On another note, do you suppose the President might have figured out how to manipulate markets with his Twitter account? <br />Johnhttps://www.blogger.com/profile/06365403570563730880noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-86672976240460558722018-04-02T08:09:32.886-07:002018-04-02T08:09:32.886-07:00Productivity and employment are two different anim...Productivity and employment are two different animals, although sometimes they are correlated. Imagine having to hire a dozen workers to handle medicare-related red tape. You get more employment, but those extra bodies are subtracting from productivity, not adding (i.e., they produce nothing of value). <br /><br />Many have speculated over the years that the productivity figures are missing some Scott Grannishttps://www.blogger.com/profile/14028519647946868684noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-42441292570209933312018-04-02T07:45:00.681-07:002018-04-02T07:45:00.681-07:00There may be measurement issues with regard to pro...There may be measurement issues with regard to productivity. Richhttps://www.blogger.com/profile/12549238790081597160noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-46463796627086399092018-04-02T07:27:36.228-07:002018-04-02T07:27:36.228-07:00Isn't productivity the flip side of employment...Isn't productivity the flip side of employment? When unemployment is high, productivity is high?<br /><br />It may also be important to consider changes in the nature of employment. For example, I work 4 part-time jobs and am far from alone in that regard. Most of my working life, I only had one.Johnhttps://www.blogger.com/profile/06365403570563730880noreply@blogger.comtag:blogger.com,1999:blog-6616959642391988608.post-46500280231170314262018-04-02T00:29:11.884-07:002018-04-02T00:29:11.884-07:00Interesting post.
regarding charts #6,7. It's...Interesting post.<br /><br />regarding charts #6,7. It's kinda hard to swallow that investment over the past 10 years has been stagnant. The iphone came in 2007 therabouts and a LOT has happened since then, especially on the IT front. Seems like we've invented a new way of doing business. Something is getting lost in those figures and therefore the "cure" might not be right Kmanhttps://www.blogger.com/profile/13486509536114426115noreply@blogger.com