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Inflation

Why the Global Economy Continues to Sputter

Kevin Price | Posted 05.19.2015 | Business
Kevin Price

Every part of an economy is aggressively pursuing the necessary capital to continue to grow. When governments crowd out that necessary capital in deficits, debt, and interest on the debt, economies cannot help but struggle where ever such policies exist.

No Excuse for Fed to Increase Unemployment by Raising Interest Rates: Movement to Hold Fed Accountable Gathers Steam

Mark Weisbrot | Posted 05.18.2015 | Politics
Mark Weisbrot

If America is to shed the title of "Land of Inequality," this is how it is going to happen: by more people becoming aware of how the Fed's monetary policy affects them and demanding that it change.

MENA's Misery Indices, a Story of Economic Failure

Steve H. Hanke | Posted 05.11.2015 | World
Steve H. Hanke

In my misery index, I calculate a ranking for all countries where suitable data exist. The misery index -- a simple sum of inflation, lending rates, and unemployment rates, minus year-on-year per capita GDP growth -- is used to construct a ranking for 108 countries.

Will The Fed Kill The Recovery Again?

Robert Kuttner | Posted 05.08.2015 | Politics
Robert Kuttner

For most of its history, the Federal Reserve has been dominated by bankers and orthodox economists, who kill the recovery at the first sign of inflationary risks. Happily, the Fed today is led by Janet Yellen, a very uncharacteristic Fed chair who spent most of her career as a labor economist, of all things. Yellen is aware of the changes in the structure of labor markets and is unlikely to jump the gun on raising rates, though it's always possible that she could be outvoted. The risk today is not that an improving jobs picture will set off inflation. It's that even tight labor markets, by themselves, will not generate enough pressure for wage increases, because workers have lost so much bargaining power.

Janet Yellen Gets the Need for Rising Wages. That's Why Republicans Are Out to Get Her.

Ian Reifowitz | Posted 05.03.2015 | Politics
Ian Reifowitz

To get back to that level and maybe even surpass it, we need someone in charge at the Federal Reserve who understands that creating conditions that increase the purchasing power of American workers' paychecks is a part of her mandate. From what she's said and done so far, it appears Janet Yellen is exactly that kind of Fed chair.

Ukraine Hyperinflates

Steve H. Hanke | Posted 04.28.2015 | World
Steve H. Hanke

Since the New Year, Ukraine's currency -- the hryvnia -- has collapsed, losing 51 percent of its value against the U.S. dollar. To put this rout into perspective, consider that the Russian ruble has only lost 8 percent against the greenback during the same period.

The Skills Gap Misery Index

Dr. Bill R. Path | Posted 04.14.2015 | Politics
Dr. Bill R. Path

If we cannot even agree on the existence of a skills gap, we will never agree upon a solution to the skills gap. Rather than being perpetually engaged in an argument over its existence, we need to be engaged in a dialogue about how to combat it.

Good Deflation: A 'Tax Cut' for Working Families

Robert Rosenkranz | Posted 04.05.2015 | Business
Robert Rosenkranz

The conventional wisdom, embraced by the Fed and by most economic commentators, is that deflation is bad. But is there an exception when "deflation" is triggered by a dramatic decline in the price of oil?

5 Steps For Making Equities Your Best Friend In Retirement

Jonathan K. DeYoe | Posted 04.04.2015 | Money
Jonathan K. DeYoe

How do you make an asset allocation decision today with imperfect information about what tomorrow holds? By making friends with equities.

The Too-Much-of-a-Good-Thing Economy

Richard Barrington | Posted 04.04.2015 | Business
Richard Barrington

You know the old expression "Be careful what you wish for; it may actually come true"? Well, somewhere there are a bunch of early-1980s economists who may now be regretting what they wished for 35 years ago.

Fed Upgrades The Economy, But Will Be 'Patient' Raising Rates

Reuters | Posted 01.28.2015 | Business

WASHINGTON, Jan 28 (Reuters) - The Federal Reserve on Wednesday said the U.S. economy was expanding "at a solid pace" as it largely looked through wea...

The ECB's Not-So-Sweet 16th

Kermit Schoenholtz | Posted 03.15.2015 | Business
Kermit Schoenholtz

If the ECB is willing to use all its available tools without limit, there is little reason to doubt that it can hit its inflation target of close to 2%. However, making that policy commitment credible remains a great challenge because of the controversy and dissent about acquiring risky government debt.

Thinking About Money

Tom F. Driver | Posted 02.28.2015 | Money
Tom F. Driver

There was a danger that eveerybody might want to take their money out of banks at the same time, in which case the banks would collapse. So Roosevelt (FDR) closed them temporarily to let panic cool down.

Speak Up and Give Back if You Want the Economy to Improve

Anthony W. Orlando | Posted 02.25.2015 | Politics
Anthony W. Orlando

No one is arguing for complete equality of income. Not even close. We celebrate the success of the One Percent, and rightly so. All we ask, especially in this time of giving, is for the compassion, the humility, the shared experience that existed only a few decades ago.

CNBC's Jim Cramer: Make Money, Don't Moralize

Timothy J. Barnett | Posted 02.21.2015 | Politics
Timothy J. Barnett

Once a nation turns its back on a resolute determination to cultivate moral deservedness, political and financial superintendency passes to those who gain power illegitimately--a fact described eloquently by President Theodore Roosevelt.

7 Questions About the Recent Oil Price Slump

Olivier Blanchard | Posted 02.21.2015 | Business
Olivier Blanchard

Oil prices have plunged recently, affecting everyone: producers, exporters, governments, and consumers.  Overall, we see this as a shot in the arm for the global economy. There is, however, much more to this complex and evolving story.

Economic Policy Myths of 2014: Dead and Enduring

Dean Baker | Posted 02.14.2015 | Business
Dean Baker

Two myths that caused great confusion over the last several years are now headed to the trash bin of history. Unfortunately, many of our great national myths have survived 2014.

Fed Shouldn't Be Raising Interest Rates Any Time Soon

Mark Weisbrot | Posted 02.07.2015 | Politics
Mark Weisbrot

With inflation still running at 1.7 percent and downside risks such as the slowing world economy, there's no excuse for the Fed to be throwing people out of work by raising interest rates. Let's hope that public pressure and an improved debate over Fed policy can keep this country moving toward full employment.

Republicans Just Don't Get It, Part II

Harlan Green | Posted 01.31.2015 | Business
Harlan Green

Instead of finding ways to increase our productive capacity and boost household incomes, which are the real wealth creators, Republicans continue to benefit the few at the top of the food chain, most of whom are only interested in enriching themselves.

Jobless Rate Falls to 5.8 Percent -- Why Be So Unhappy?

Harlan Green | Posted 01.09.2015 | Politics
Harlan Green

Job creation in October marked the ninth straight month the economy has added 200,000 jobs or more, a feat last accomplished in 1994. The U.S. has created some 2.3 million jobs this year and is on track for the biggest gain in almost a decade.

Inflation-Deflation See-Saw

Terry Savage | Posted 01.04.2015 | Money
Terry Savage

There's no rhythm to the process, only the unexpected swings and lurches. Once you understand this analogy, you'll be less anxious and less prone to jump to one side or the other in a reaction to the latest news.

Which Hazard Is Better Contained: Ebola or Extreme Economic Inequality?

Timothy J. Barnett | Posted 12.27.2014 | Politics
Timothy J. Barnett

Design changes in Ebola management protocols make it highly probable that the Ebola hazard in America will be successfully contained. In contrast, the hazard of wealth-concentration policies implemented by central banks is not under containment. This problem threatens the very fabric of democratic enterprise.

Where Is That Inflation We've Been Waiting For?

Luis Ubiñas | Posted 12.17.2014 | Politics
Luis Ubiñas

Fear of resurgent inflation has been a defining element of U.S. economic policy over the last five years, driving federal spending reductions, personal income tax increases, and, just this month, the end of the Federal Reserve's Quantitative Easing program. But that broad-based inflation has not materialized and we are left asking why?

Recovery of the Rich, By the Rich, For the Rich -- Recession for Everyone Else

Anthony W. Orlando | Posted 12.17.2014 | Politics
Anthony W. Orlando

Officially, the recession ended five years ago. But there's something the financial newscasters don't tell you: Unless you're rich, those numbers don't apply to you.

Do Minimum Wage Increases Benefit the Middle Class?

Timothy J. Barnett | Posted 12.13.2014 | Business
Timothy J. Barnett

This is not to argue against minimum wage increases as much as to argue that this remedy must not be substituted for reforms at deeper levels.