The Successor to Keynes
By Jeff Thomas, International Man
Europe is currently buzzing about the release of *Capital in the Twenty-First Century* by renowned French economist Thomas Piketty. Released in March, this book has quickly become a bestseller, not only in Europe but now also on Amazon in the United States. Reviewers have hailed it as a potential game-changer in economic literature.
Here are some notable insights from critics:
Piketty proposes a solution that extends beyond the legislative scope of individual nations or existing international organizations: a global wealth tax. He argues that only such a tax could effectively curtail the rapidly escalating global inequality of wealth, which is currently growing at an unsustainable pace.
—Thomas B. Edsall Continue reading
Yesterday, the U.S. markets were closed in observance of Memorial Day. However, we took the opportunity to peer through our Economic Prism for insights into what the future may hold. There is no doubt — we believe the bull market is nearing its end. If it isn’t, it certainly should be.
We’ve explored various reasons for this sentiment, including stock valuations and the historical durations of bull markets. We’ve pointed out numerous indicators signaling turbulent waters ahead. Corporate earnings seem destined for a decline.
Yet, astonishingly, each day the stock market continues to rise, reaching heights we could hardly have imagined.
Is it possible that we live in a world where the upside is limitless and risk has vanished? Not unless one embraces an illusion.
With every passing day of the bull market, we are reminded that it inches closer to its conclusion. Additionally, the higher the stocks soar, the harder their eventual fall will be. Continue reading
This week, a Federal Reserve insider rang the alarm and shattered the illusion of security.
“A strengthening U.S. economy may compel the central bank to raise interest rates ‘sooner rather than later’ in order to stay ahead of inflation,” remarked Philadelphia Federal Reserve President Charles Plosser on Tuesday.
In a different vein, Fed Chair Janet Yellen delivered a commencement address at Yankee Stadium, where she emphasized that success relies more on grit and passion than raw talent. She cited former Fed Chair Ben Bernanke as a prime example of someone whose determination saved the financial system during its darkest hours.
In Yellen’s perspective, Bernanke’s extensive monetary intervention was a remarkable success. For those of us who are taxpayers, savers, and parents, this notion feels utterly dismissive. Hearing remarks like former Treasury Secretary Timothy Geithner’s, “We did save the economy, but we lost the country doing it,” strikes a painful chord. Continue reading
As commencement season unfolds, while we may not have been invited to speak at any trade school or institution, we still offer invaluable insights for this year’s graduates.
Congratulations! You have successfully completed your academic journey and are now set to begin your real-world education in the school of hard knocks. Each of you is enrolled, and some of you may thrive amidst the challenges.
Be prepared to discover that what you learned in college may not fully equip you for your forthcoming endeavors. The reality of the job market you have been led to believe – filled with plentiful opportunities and lucrative positions – exists only in fragments, if at all. Moreover, your predecessors have placed an enormous burden on your shoulders: you will be responsible for financing their retirement as well as your own.
Where do you begin?
Firstly, the school of hard knocks does not adhere to a four-year timeline. Continue reading
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