What Do Banks Do? What Should They Do?

Some time back there was a bit of a kerfluffle when Paul Krugman argued that one shouldn’t bother with Minsky if one wants to understand banking. He went on to present the typical, and fatally flawed, textbook view. See here: http://www.economonitor.com/lrwray/2012/04/02/krugman-versus-minsky-who-should-you-bank-on-when-it-comes-to-banking/, and here: http://www.economonitor.com/lrwray/2013/08/28/krugman-rediscovers-the-wheel-commercial-banks-as-creators-of-money/, for my responses. A new issue of Accounting, Economics and Law […]

Fiscal Fiasco—This Time is Different?

It now looks like the government will shut down this evening.   The Senate is likely to make one more effort to pass a clean continuing resolution (CR), but at this stage the Republican House seems unwilling to let go of its animus for Obamacare.  Perhaps they will settle for something symbolic–one idea is for Congress […]

Best to own a business rather than work for one

In my effort to move away from covering Europe exclusively on this blog, I’ve returned to a little niche of economic data that had intrigued me in the past: US national income accounts/accounting. This time I’ll look at national income, specifically corporate profits – I’ve written about it before, and my colleague Ed Dolan covered it on […]

State GDP shows a manufacturing rebound in 2012

State GDP shows the following in 2012: durable goods manufacturing and finance and insurance are primary drivers of cross-sectional growth. This confirms the national story, according to the BEA. A state-level breakdown shows strong (a surge in) economic activity in North Dakota, Oregon, Texas, and Utah, as 2012 real GDP was the highest in these economies compared […]

Who has the most debt in the US?

This was the question posed to a group of my colleagues as regards the merits of US fiscal and monetary policy: guess who has the most debt in the US economy? Everyone at the table said ‘the government’. When most pundits talk of ‘government debt’ they are inherently referring to federal government, who is not […]