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Learn Economics

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Learn economics. Topics in Economics can give even the newbie insights into how the economies of the world work with a focus on China and the USA. There are 30 topics listed with articles on those subjects, as well as a glossary of terms.
I have written a lot of vetted articles that are exclusive** to Talkmarkets. Sorting a portion of them by subject will give the reader an opportunity to make sense of it all. I am adding a glossary of terms at the bottom of this page.

For readers interested in economic subjects of the day, these top 30 themes are my efforts to make understanding economics easier:

I have pinned the following article to the top because it is an insight into my personal life, as well as a commentary on isms. Capitalism is still the greatest system for creating wealth. However, it is often mixed, and mixturism is a factor in its success or failure:




1. China! 

Dangerous History Repeats

Trump May Be Wrong About Winning a Trade War

Keynes and Trump Tariffs
The Achilles Heel of Tru…

The Fed Will Take the Stock Market Down

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This article was first published by me on Talkmarkets: https://talkmarkets.com/content/bonds/the-fed-will-take-the-stock-market-down?post=168127&uid=4798

There is a warning from Tim Duy that the Fed views inflation as being in the danger zone. This does not mean the Fed is right. It does not mean the Fed is wrong. But it means the Fed will likely take down the stock market.

The capitalist fear of workers making too much money is now coupled with the Fed's understanding that bonds are collateral, in such massive amounts that they simply cannot tolerate large jumps in long interest rates.

By hitting the short rates hard, the Fed will give confidence to those in the bond market that long bonds are still worth buying. If there is an inversion, oh well.

This is what came from the Fed itself, even though it is not reaching its 2 percent inflation target:

In gauging the appropriate path for monetary policy over the next few years, the FOMC will continue to strike a balance between av…

Bond Vigilantes, Liberty Street Fed Collateral Study, and Art Cashin

This article was first published by me on Talkmarkets: https://talkmarkets.com/content/bonds/bond-vigilantes-liberty-street-fed-collateral-study-and-art-cashin?post=167584&uid=4798

Art Cashin clarified the limits of volatility, as his statement about the 3 percent barrier to 10 year bond yields caused yields to decline. I don't know if the barrier is permanent and an accurate measure, or if breaking it a little bit would not cause chaos. But clearly, owners of stocks and bonds took Cashin seriously, and the 49th tantrum which goes for higher yield, was stopped in its tracks.

Well, I exaggerate. It may just be a few efforts at tantrum attacks on bond yields since 2013. But it is so continually attempted that it seems like 49 tries at it! Here is my take with a little help from Liberty Fed analysts, who say that there is something at work regarding long bonds that does not reflect traditional market moves.

Bond Tantrums and Goldman Sachs

So then, what is going on with all these …

Corporate Debt as Economic Indicator: Jesse Colombo

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This article was first published by me on Talkmarkets: https://talkmarkets.com/content/bonds/corporate-debt-as-economic-indicator-jesse-colombo?post=167199&uid=4798

Corporate debt as an economic indicator is highlighted by charts provided by Real Investment research, and author Jesse Colombo. The charts are important, because there is a recurring pattern. I have isolated three of the charts that point out late cycle danger lurking for stocks and corporate bonds. This is not an analysis of treasury bonds, which will likely behave differently in a downturn.

We can see that danger lurks as corporate America's debt load soars. However, Year Over Year percentage change has shown that this debt does not always bring on a recession, as we see in the early 1980's in chart 1. Also, debt is high now, but it has been higher with regard to percentage change, seen in chart 1 as well.

The vulnerability has more to do with interest rates impacting this debt. Chart one shows danger, but …

Ron Feldman's Fed Secret and Treasury Bond Behavior

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This article was first published by me on Talkmarkets: https://talkmarkets.com/content/bonds/ron-feldmans-fed-secret-and-treasury-bond-behavior?post=165982&uid=4798


Fed Reveals Secret Bank Bond Protection

Before getting into sovereign Treasury Bond behavior, we learned that Minneapolis Fed Vice President Ron Feldman revealed another terrible Fed secret.

Of course, we know that his boss, Fed President Neel Kashkari has said the Fed prunes wages. Now we find out that the Fed refuses to let bank bond holders take losses. In an interview with David Beckworth at the Mercatus Center, Feldman uttered this must read quote:

The only active creditor in the US where we have a record that we do impose losses on them is equity holders. We do treat equity holders differently from fixed income holders, depositors, or bond holders...The thing that’s not credible is that in a crisis, a government is going to want to impose more losses on debt holders. It is one thing for the Fed to act this way. Bu…

Kalecki's End of the Business Cycle and Bond Wars

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This article was first published by me on Talkmarkets: https://talkmarkets.com/content/bonds/kaleckis-end-of-the-business-cycle-bond-wars?post=165494&uid=4798


Michal Kalecki was a distinguished Polish economist who discovered insights into functioning of capitalism and the business cycle. He understood that full employment was anathema to the capitalist system, and that allowing a certain level of unemployment was key to preservation of the capitalist class. This is, of course, why I have warned that the greatest job of the Fed is to prune wages, and slow the economy as full employment approaches.

From Kalecki's point of view, capitalists want to limit government spending except for armaments, which benefit the class. Recent tax cuts have shown that the Republicans, especially, have bloated armament spending while destabilizing the stock and bond markets with volatility, and with tax breaks that cannot easily be paid back. This instability could hasten the demise of the curre…

Attacking the Everything Bubble Without Killing the Economy

This article was first published by me on Talkmarkets: https://talkmarkets.com/content/global-markets/attacking-the-everything-bubble-without-killing-the-economy?post=190774&uid=4798

Mish Shedlock is a regular founding contributor to Talkmarkets. His insights are very interesting and his column here is always worth the read. I agree with him on most issues.

But he advocates similar ideas to the Fed line of raising interest rates. I think that advocacy is wrong. I believe that there are other ways of cooling the financial system, according to economist Thomas Palley, without across the board raising of interest rates.

Before discussing that, here is a look at issues that concern Mish. There are at least two reasons Mish thinks the way he does on the need to raising interest rates:

1. Mish does not believe that the Fed should commit to future booms to offset large financial busts because we already have too much asset inflation, and inflating assets more will be more deflationary in…

Did Goldman Sachs Have Anything to Do with Market Volatility?

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This article was first published by me on Talkmarkets:


Did Goldman Sachs have anything to do with market volatility? Does a bear...? I think that you have to connect a few dots, but very few, to prove that Goldman Sachs, or at least its alumni, was instrumental in helping to create market volatility.

Whether for good or bad, those who did not listen to Lloyd Blankfein and bet on low VIX volatility, apparently lost their shirts.

First, we have to look at the many statements that Lloyd Blankfein, Goldman CEO said regarding the lack of volatility and the lack of profits at the firm. Here is a brief list:

Lloyd Blankfein: It's Quiet Out There...Too Quiet

Why Lloyd Blankfein Is Fretting About Low Low Rates

Goldman Sachs CEO Lloyd Blankfein Looks Like the Runt of Wall Street Litter

Ouch.

Whether for good or bad, those who did not listen to Lloyd Blankfein and bet on low VIX volatility, apparently lost their shirts in the big downturn.



So, was Lloyd just a prophet, doing God's work as …