Thursday, 29 October 2015

Around the Traps 30/10/15

It is time for Around the Traps.

Northern America
Andrew Gelman ( Mainly Stats)
Genial Dave Giles ( Econometrics)
Dianne Coyle ( Quirky + Book Reviews)
Vox wonk

Wednesday, 28 October 2015

Stagflation is occurring!

The ABS released the CPI for the September quarter yesterday.
The underlying rate was a measly 0.3%. This is despite the $A falling quite a bit.

Stagflation is rising rapidly obviously

Tuesday, 27 October 2015

Red Meat and Cancer

Recently the World Health Organisation came out with a warning on red meat and cancer.

 Helpfully Bernard Stewart writing on the Conversation (a must read site) tells us what is important and what it means.
Greg Laden is also helpful. So is Kaiser Fung

Monday, 26 October 2015

Canada likes Keynes

Kruggers wrote a column some time ago saying Keynes returns to Canada.

Nick Rowe wrote after that he never left Canada,Simon Wren-Lewis joins in and essentially agrees with Nick as do I.
( Nick links Kruggers and Simon links Nick)

This is why I always ignore Governments who talk the talk I always look at how they walk the walk.

Comments on Nick's article well worth reading.

Wednesday, 21 October 2015

Joe Hockey was a failure

Joe Hockey made his last speech yesterday.
He was a total failure. I can recall as a Minister despite having excellent staff when Minister for Financial Services he was never on top of the detail.

When Opposition Treasury spokesman he wailed against the entitlement mentality overseas but when he got back home he said the ALP Government's attempt to have sterner means test on family benefits was class warfare.

As an incoming treasurer he claimed he inherited a deficit and debt disaster. He never did say how PEFO was wrong or claimed the Secretaries of Treasury and Finance has lied .

The fact that both the deficit and debt has increased shows what a total failure Hockey was.
If you say quite accurately the terms of trade made this a certainty I would agree however Hockey in Opposition would not hear of this when Wayne Swan made the argument so it is only fair not to allow Hockey this excuse.

Here is Greg Jericho

Tuesday, 20 October 2015

Around the Traps 23/10/15

It is time again for Around the Traps.
Very busy over the weekend but will try and update. Interesting stuff in General!

Northern America
Andrew Gelman ( Mostly Stats)
Genial Dave Giles ( Econometrics)

Dianne Coyle ( Quirky + Book Reviews)

Vox Wonk

Monday, 19 October 2015

Turnbull thus far

Malcolm Turnbull is sailing with a wet sail thus far.

He has been helped by very poor ALP tactics courtesy of the right wing faction of the NSW ALP.

People also personally like Turnbull just like they didn't like Abbott.
However it seems to me they are waiting for him to change tack now he is Prime Minister. He could get caught between what the voters expect and what the right wing of the Liberal party politicians want.
We shall see.

It is funny to hear about various 'right wing' types frothing at the mouth at Turnbull.

What has really irked them is they are now seen to be wearing no clothes.
They claimed to be speaking for the majority of people. Now they have been shown to be people who speak for no-one so they are raging.

Andrew Bolt has been shown to write articles without doing any research at all. always remember those people could have sued for libel and gotten money but didn't.

Alan Jones took money from companies and didn't disclose it.

Any other persons who did work like these two would have been sacked. Not these two. Amazing.

 Kevin Bonham on poll-roundup-wealth-attack-on-pm-fails

Sunday, 18 October 2015


Timothy Taylor has a great blog. He writes on a variety of topics in economics.

On Friday's Around the Traps he wrote about Infrastructure.
It is , as usual, a very interesting read.

He concluding thoughts are:

1) You need to have a detailed plan of projects that really are shovel-ready, like the federal highways in the 1950s. Otherwise, it's just too slow to get such project underway when a recession hits. Perhaps the ideal approach is to have a long-term project happening on an ongoing basis, with the possibility for speeding it up if a recession hits.

2) Government is often focused on the infrastructure that it owns directly: like roads, bridges, and sewer lines. These areas matter, of course. But the future of the US economy will rely on a lot of other kinds of infrastructure, many of which are either privately owned or are some form of public-private partnership: including phone and cable lines, electricity generation and transmission, pipelines for oil and gas, railroad tracks, airport and seaport capacity, and water reservoirs and pipes. A broader focus on infrastructure would think about ongoing efforts to build infrastructure in these areas, and how some form of government support might accelerate them during a recession, too.

3) Pretty much everyone favors infrastructure in theory, but in practice, there are often some hard issues to work out. How does one focus on infrastructure that has the largest payoff, rather than just spreading out the spending to favored state and congressional districts, or contracts to favored political interests? How does one make sure the best deals get negotiated for the use of taxpayer support? Many kinds of infrastructure involve a mixture of user payments and taxpayer money, and how should those user payments be structured? Finally, how do we balance the need to give opponents of infrastructure projects a fair hearing, but also not give opponents an unfettered ability to use "lawfare" to block infrastructure projects?

I remember when I criticised the initial stimulus here because we should have been spending on a dual carriage way from Melbourne to Brisbane.
I learnt two things.
Sinclair Davidson had no idea of how important trucks were in transportation in Australia.
There were NO shovel ready projects to go. Indeed I learnt only Sweden had shovel ready projects to go in all OECD nations.

I am hoping Nations have learnt their lesson now. given howl ow bond yields are and how little infrastructure projects are underway It appears not.

Thursday, 15 October 2015

Around the Traps 16/10/15

It is time for Around the Traps.

Northern America
Andrew Gelman ( Mainly stats)
Genial Dave Giles ( Econometrics)
Dianne Coyle ( Quirky + Book Reviews)
Vox wonk

Wednesday, 14 October 2015

ALP attack on Turnbull falls flat

The ALP tried to make hay about Malcolm Turnbull having money in funds which have their headquarters in the Cayman Islands.
Lenore Taylor tells all.

This attack was originated by Sam Dastyari a highly unimpressive man. Factional warlords rarely make good politicians as Graham Richardson showed. ( Nor do they make good analysts of politics).

We can come to only two conclusions

Either the ALP did not know about the subject they were talking about or they simply wanted it to appear Turnbull didn't pay tax merely because the funds he uses are in tax dodge territory.
Of course thus was untrue.

I would have thought Dastyari's role in bringing down Rudd on untrue polling would rule him out nut no. All of his political career in Canberra thus far has been to be euphemistic unimpressive.
He is now on the front bench. Why? Given his history one hopes Mr Shorten  does rely on him for advice or strategy. Yesterday clearly showed why!

Tuesday, 13 October 2015

Polling update

What a difference a new leader makes or does it???
Mark the Ballot on the numbers.
The inimitable Kevin Bonham on what it means if it does mean anything. Not yet I think is the summary.

Monday, 12 October 2015

Unemployment in the USA during the Great Depression

Eric Rauchway had a great article on this. on how unemployment was measured differently to how it was in Germany for example.
Now I am late on this but it makes for interesting reading.
If only Gerry Jackson was in good health it would make for a great debate.

It further backs up my theory that if Roosevelt had a policy of real wage reductions as advocated by Keynes ( inflation illusion) then the US recovery would have  been comparable to Germany's recovery.

Sunday, 11 October 2015

What is a terrorist?

I had a good friend over on Sunday and we talked about both the Lindt office and Parramatta killings.

I was asked whether they were terrorist acts.

I said no.  Why?

A terrorist act involves many murders which invokes terror on  the population. this in turn invokes a behavioural change .

Let me illustrate with an example.

Way back in the late 1940s. Jewish terrorist groups such a Irgun and the Stern gang et all massacred Palestinians in Palestine.
It was done on such a scale and with such violence that tens of thousands of Palestinians simply left their homes and possessions fearing for their very lives.  ( Hamas could only dream on doing such things).

Now let us think of the Lindt and Parramatta killings. Did they invoke terror at all? Did they invoke any behavioural change at all?

They were not terrorist attacks simply murders by deranged people.

Thursday, 8 October 2015

Around the Traps 9/10/15

It is time for Around the Traps again.


Northern America
Andrew Gelman ( Mainly Stats)
Genial Dave Giles ( Econometrics)
Dianne Coyle ( Quirky + Book Reviews)
Vox wonk

Wednesday, 7 October 2015

Katesy is still ignorant

poor old Katesy.

There is he writing utter nonsense amongst people whom wouldn't know.
Now he writes about the foolishness of Keynesian economics,
oh dear. if there has been a person more ignorant or stupid who has written in the blogsphere I have yet to encounter him or her.
Katesy is the man who thinks Europe went on a Keynesian pump priming scourge. Except they didn't. They introduced contractionary policies that everybody acknowledged , even the Germans, but not out Katesy.

Those wonderful classical economic policies did not produce any recoveries anywhere. It did produce depressions. Just ask Ireland, Greece or even Estonia!

One of his great comments was that the statisticians were all Keynesians. You cannot trust any of them.

I do remember one time when he was mouthing off against Obama he claimed the government spending was destroying the economy, However that quarter as with many quarters the public sector did not add to GDP growth.
Lets us add understanding Statistical agency bulletins to basic statistics that he doesn't understand.

He says Costello ,by implication , adapted Classical economics.
When they won office in 1996 Treasury recommended tight economic policies. This was actually totally Keynesian and it was said as much.
By the end of their Government Peter Boxall was recommending a classical type policy in keeping the surplus at 2% of GDP. This was clearly not contractionary enough given events in Australia and hence we got increased inflation which is what Ken Henry said what would happen.
Oh Dear.

We must not forget he rewrites history. Keating and Costello were facing recessions when they got their budgets back to surplus apparently.

The only reason he writes at Catallaxy is Davidson will not allow anyone yo comment on how inaccurate out Katesy is. He bans anyone who do not write along the politburo there  spouts,
That is why basic mistakes by anyone there gets through and no-one spots them. They do not posses the nous to do so. that is why no-one commetns anywhere else. Like Our Judy they will leave with their tail between their legs after her Troppo fiasco,

Just remember our tax dollars are paying this man!

okay okay. for efficacy of stimulus see here

I see Katesy is now saying people fleeing ISIL will end up terrorists. Wow.What an intellect.

He keeps on supporting Abbott.
The man who increased both  deficits and debt. the man who said he would be the infrastructure Prime Minister but had such spending at its lowest level of GDP.
A man who both stopped the boats but also turned them back.
Yep it is no wonder Katesy supported the man.

Tuesday, 6 October 2015

Penalty rates again

I see more talk about getting rid of penalty rates again.

Two things.
Most people who work on the weekends are uni students. What do think they will do if their money is reduced?

We have seen some sort of example of this. Coles thought to bring down wage rates in their night fill yonks ago.  They no longer have night fill.

You will have some people putting their hands up . The people who need the money at all costs. However the decision between leisure and lower pay on Sunday would be a no-brainer.

I am still amazed no-one examines the supply side of labour when looking at penalty rates.

Monday, 5 October 2015


It seems as though the TPP is now a signed agreement.

As it is a multi-lateral agreement there will be more benefits than the alleged benefits spruiked absurdly by the Government on the bi-lateral agreements.. Andrew Robb plainly did not know about the modelling commissioned by his own department.
On the other hand if the agreement is mainly about intellectual property as alleged by Kruggers then the benefits will be much lower.
Until we see the actual agreement we do not know. David Collins has some useful insights.
THIS is quite critical.
We can but hope it might jump start trade.

Thursday, 1 October 2015

Around the Traps 2/10/15

It is time for Around the Traps again.It is a long weekend in Sydanee so updates could be problematic.

Aussie,Aussie,Aussie, Oy,Oy,Oy
Northern America
Andrew Gelman (mainly stats)
Genial Dave Giles (Econometrics)
Dianne Coyle ( Quirky + Book Reviews)
Vox wonk